Bitcoin has lost major support at $45.000 dollars and has seen a drop of 18% since then over the course of a 2 week period, retracing the entire rise Bitcoin has given prior to this. Since then we have traded back into its support zone that has been established in early march, seen in the red box. The question remains here, is this support region strong enough to initiate another larger move to the upside or is it more probable that we will see more downside.
In order to find the next clue, lets zoom in a little closer. Since touching the red box below we have established a new range with build up support at $39.500 and resistance at $40.500. After its establishment of these levels BTC has tested $39.500 once more to confirm the demand line, resulting in a rise and retracement, leading up into a higher low. This higher low set the stage for a change of the local structure allowing BTC to gather enough strength to break through its $45.000 resistance. This in turn makes increases the probability to see higher prices with $42.000 being the nearest significant resistance level. On the flipside, should we start trading back into the blue box again, the probability increase for a further drop in price with $39.000 being an important support level. Until these levels are lost or reclaimed it remains unknown whether price will see higher or lower prices. Therefore the sensible approach is to look at the local levels before anticipating on larger moves.
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