The Bitcoin (BTC) price has fallen since January 11, culminating with a low of $39,430 yesterday.
BTC broke down from a key horizontal support area. Does this mean the local top is in?
Bitcoin Continues Falling
The weekly time frame technical analysis shows that the BTC price has increased inside an ascending parallel channel since the start of 2023. The price broke out from the channel in November and reached a high of $48,969 in January 2024. The high coincided with the approval of the Bitcoin Exchange-Traded Fund (ETF).
The BTC price has fallen since, creating a bearish shooting star candlestick. This week, it is moving inside the channel’s confines and approaching its midline, which coincides with a Fib support level.
BTC/USDT Weekly Chart. Source: TradingView
The weekly RSI gives a bearish reading. Market traders use the RSI as a momentum indicator to identify overbought or oversold conditions and to decide whether to accumulate or sell an asset.
Readings above 50 and an upward trend indicate that bulls still have an advantage, whereas readings below 50 suggest the opposite. While the indicator is still above 50, it fell below 70 (black icon), a sign of a weakening trend.
Read More: Where To Trade Bitcoin Futures
What Do the Analysts Say?
Cryptocurrency traders and analysts on X have a bearish outlook on the future trend. Honey_xbt drew simple horizontal areas to note the rejection from $50,000 and predict a subsequent drop to $35,000.
BTC/USDT Weekly Chart. Source: X
Cold Blooded Shiller is bearish because of the price movement and indicator readings. He tweeted:
Renko shows this $BTC momentum shift very well too. Significant pressure on the downside (not seen in over 18 months but taken with a pinch of salt given the repainting) – but the AO is strengthening. Also the clear support compromise at $40,000.
Income Sharks suggests the BTC price will plunge below most main support levels until it reaches $32,000.
Read More: Who Owns the Most Bitcoin in 2024?
BTC Price Prediction: Has the Price Reached a Top?
The technical analysis of the daily time frame aligns with the bearish one from the weekly chart because of the price action and RSI readings.
The chart shows that the BTC price broke down from the $41,000 horizontal support area, which had stood for 48 days. After the breakdown, there was no significant bounce, and Bitcoin still trades below the area.
The daily RSI is also interpretative of a bearish trend. The indicator fell below 50 (red icon) for the first time since the bull run started on October 16, 2023 (green icon). This is a sign that the previous bullish trend has ended and a bearish one has begun.
Read More: What is a Bitcoin ETF?
If the decrease continues, BTC can fall 5% to the 0.5 Fib retracement support level at $36,900 or decrease by 12% to the 0.618 Fib level at $34,000.
BTC/USDT Daily Chart. Source: TradingView
Despite the bearish BTC price prediction, reclaiming the $41,000 horizontal area can lead to a 14% increase to the previous range high of $44,000.
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Disclaimer
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