Bitcoin (BTC) has encountered resistance at the $31,500 level and has since retraced to a range between $30,300 and $30,800. The failure to reclaim the $31,000 territory has raised concerns among investors, suggesting that bears may still hold an advantage in the market.
Despite recent strong performance, Bitcoin’s inability to surpass crucial resistance levels has left many cautious. The current consolidation within a range indicates vulnerability to further losses in the near term.
Analyst Justin Bennet points out that latecomers to the BTC rally may face challenges as Bitcoin rarely offers easy gains. Price action suggests a potential pullback from the current levels above $30,000, similar to the April swing high visible on the 8-hour timeframe.
Bitcoin closed above the $30,400 mark on the 8-hour trend line in April but fell below it in subsequent candles. While BTC has shown more resilience this time, the 4-hour timeframe has already dipped below $30,400. The confirmation of this breakdown will depend on the next few 8-hour candles.
Bennet predicts a pullback toward the $28,000 range to shake out latecomers if the breakdown is sustained. The Bitcoin price action around $27,000-$28,000 during this test will determine its trend for July. However, a sustained break above $31,000 would suggest continued bullish control and potentially expose $32,500.
Nevertheless, as long as bulls can hold the $30,000 line, the ongoing uptrend in Bitcoin will likely persist. Historical data indicates that consolidating and maintaining this crucial support level allows Bitcoin to reach higher levels and achieve new yearly highs.
Conversely, if bearish pressure intensifies, the $29,500 support level becomes the next critical threshold to monitor. A drop below this level could trigger a further decline towards the $27,300 mark.
Despite the potential risks, upbeat news regarding Fidelity and BlackRock’s Spot Exchange-Traded Funds (ETF) applications continues to support the Bitcoin market. Approval of these ETFs could bolster price action and potentially lead to new yearly highs.
Bitcoin is trading at $30,600, reflecting a modest 1.4% increase over the past 24 hours.
Source: https://bitcoinworld.co.in/bitcoin-struggles-to-break-key-resistance-level-potential-for-short-term-pullback/