Bitcoin rejected at $48,000 (all-time high), forcing bulls to seek support above $43,000.
Some technical indicators suggest that the correction has just begun; thus, BTC could fall to $38,000.
A golden cross on the 4-hour chart could invalidate the downtrend, allowing Bitcoin to resume the uptrend toward $51,000.
Bitcoin surprised many following the recent spike to a new record high at $48,000. The flagship cryptocurrency rallied as Tesla, the world’s largest electric vehicle manufacturer, bought BTC. The Elon Musk founded company also committed to letting customers pay for the vehicles with BTC.
Meanwhile, Bitcoin has retreated from the all-time high and is currently exchanging hands at $44,770. If higher support above $40,000 becomes challenging to secure, the bellwether cryptocurrency may explore lower levels.
The region at $38,000 was a critical barrier during the recent run-up from $30,000. However, it has flipped into a formidable support area likely to absorb the selling pressure and stop the declines.
A comprehensive look at the Moving Average Convergence Divergence (MACD) suggests that the least resistance path is downwards. When the MACD is used correctly, it can identify exit positions and buy the bottom entry points. For now, the MACD line (blue) has crossed below the signal line, which is a clear indication to avoid entries and perhaps sell.
Bitcoin’s downtrend is likely to continue in the near term. However, we can not say for sure how far it will go. Note that the 100 Simple Moving Average has crossed above the 200 SMA on the 4-hor chart, forming a golden cross. This bullish signal could see BTC ignore the bearish call and resume the uptrend toward $51,000.
Luke has had a long interest in financial technology, especially cryptocurrency and blockchain. With a Bachelors degree in Journalism and Media, Luke is dedicating his writing skills for the digital currency sphere.He can be contacted at firstname.lastname@example.org