Bitcoin has been flashing signs of immense strength throughout the past few days as it pushes up towards the mid-$9,000 region.
Although on a surface level this movement appears to be bullish, it is important to note that the cryptocurrency is now pushing up against heavy resistance. A rejection here could ultimately lead it to see massive losses in the days and weeks ahead.
This potentially imminent decline could erase virtually all of the gains that have come about as a result of the latest uptrend.
One analyst believes that it could even result in a full-fledged downtrend if buyers are unable to support the crypto above $9,100.
Bitcoin Climbs to $9,500 as Upwards Momentum Mounts
At the time of writing, Bitcoin is trading up just over 3% at its current price of $9,460. This marks a notable upswing from the cryptocurrency’s recent lows of $8,800 that were set earlier this week.
BTC has been struggling to garner any significant momentum in the time following its recent series of rejections at $10,000. Today’s climb may allow it to revisit these highs, however.
In the near-term, analysts are cautious about being too bullish on Bitcoin, as it is currently pushing up against a heavy resistance level that could ultimately lead it to see some major losses.
It appears that this resistance exists around $9,500, and another rejection here could be enough to spark a full retrace.
One popular pseudonymous trader spoke about this in a tweet, explaining to his followers that there are a few factors suggesting that the crypto is fundamentally weak.
He points to the fact that the crypto is currently trading at its range highs, is underneath a key trendline, and is pushing against heavy resistance as reasons why he is bearish.
“BTC – Still remaining flat. Areas of interest: * 94 – 95s * Range highs * Trendline underside * Any signs of weakness and failure to hold 91s – then may flip short,” he explained while pointing to the $8,300 target on the chart seen below.
Image Courtesy of TraderXO
BTC Fast Approaches Critical Monthly Close
Another analyst recently explained that Bitcoin is fast approaching a key monthly close that could have heavy influence over where it trends throughout the summer months.
He notes that Bitcoin has not closed above $9,360 in nearly 12 months, adding that previous rejections at this level have catalyzed massive downturns.
“People referring to the importance of this BTC level, so I thought I’d provide you with the Monthly view. We’ve not had a Monthly close above 9360 in nearly 12 months. Rejections from this level have led to tests of $6k and eventually $3k. 4h range bouncing around this level,” he stated.
Image Courtesy of Cold Blooded Shiller
Featured image from Shutterstock.
Bitcoin Could Soon See a $1,300 Loss as It Nears Key Resistance was last modified: May 28th, 2020 by Cole Petersen
Cole is a cryptocurrency analyst based in Los Angeles. He studied at the University of California Irvine and has been interested in Bitcoin and the crypto markets since 2013.
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