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Bitcoin analysts observe key support levels and potential rebound despite bearish sentiment.
Amid the recent turmoil caused by selling activities, signs of stability and potential recovery are emerging. Notably, Rekt Capital and Ali Martinez have provided insights into Bitcoin’s current market dynamics, both long and short term.
Rekt Capital recently highlighted Bitcoin’s initial signs of stability following a significant crash. He noted that Bitcoin is gradually approaching the downtrend marked by a light blue trend line. This trend line, showing lower highs and lower lows, represents a critical resistance level. The red-shaded area around the $72,500 level also indicates a major resistance zone.
#BTC
Bitcoin is showcasing some initial signs of stability after the crash
And in doing so, it is creeping closer to the Downtrend (light blue)
This Downtrend will be challenged if the Bullish Divergence plays out$BTC #Crypto #Bitcoin https://t.co/2TrYTkvb4H pic.twitter.com/vv98DSufPQ
— Rekt Capital (@rektcapital) July 9, 2024
Rekt Capital also observed a bullish divergence in the RSI (Relative Strength Index). This divergence, where the price makes lower lows while the RSI makes higher lows, suggests weakening selling momentum. If this bullish divergence takes its course, Bitcoin could challenge and potentially break through the downtrend, signaling a reversal.
Reclaiming Support Levels Amid Fake Breakdowns
In a separate analysis, Rekt Capital pointed out Bitcoin’s ability to reclaim a crucial support level. The horizontal line around $56,758 on the chart, previously breached during a fake breakdown, was reclaimed. This fake breakdown saw the price briefly dip below this level before quickly recovering, indicating strong buying interest.
#BTC
Bitcoin has managed to reclaim the purple level as support, despite the fake-breakdown$BTC #Crypto #Bitcoin https://t.co/304O4KglgY pic.twitter.com/Z2Bi6qgHqe
— Rekt Capital (@rektcapital) July 9, 2024
Additionally, Rekt Capital identified two significant resistance levels at $61,000 and $71,000. Bitcoin’s recent price movements, particularly its ability to stay above the purple support level, suggest a positive market sentiment. However, to confirm a bullish outlook, Bitcoin must break through these immediate resistance levels.
Short-Term Analysis by Ali Martinez
Meanwhile, Ali Martinez provided a short-term analysis, noting that Bitcoin is trading within a well-defined parallel channel. This channel, marked by two black lines on his chart, indicates the upper and lower boundaries. Currently, Bitcoin is near the channel’s lower boundary, around $57,200 to $57,400, which acts as support.
On lower time frames, #Bitcoin is currently trading within a parallel channel. As $BTC hovers near the channel's lower boundary, the TD Sequential indicator flashes a buy signal, suggesting a potential rebound to around $58,300! pic.twitter.com/qe05Y6M0BY
— Ali (@ali_charts) July 9, 2024
Martinez also highlighted the TD Sequential indicator, which is flashing a buy signal. This indicator suggests the current downtrend might be nearing exhaustion, and a rebound could be imminent. The potential rebound target is around $58,300, closer to the mid-range of the channel.
Market Sentiment and External Influences
The broader market sentiment around Bitcoin has been notably bearish, influenced by expected selling pressure from Mt. Gox creditors and the German government. However, Santiment, a market intelligence firm, predicts a likely rebound, potentially catching the market off-guard.
Despite fears of a sharp sell-off due to Mt. Gox repayments, analysts like CryptoQuant’s Ki Young Ju suggest that the movement of 47,000 BTC may not impact the market as expected. He outlined three scenarios, including internal transfers for security, that may explain the recent on-chain movements.