A Visit to This Crucial Support Region Could Start Bitcoin’s Next “Moon Mission”
Bitcoin has faced some turbulence throughout the past couple of days.
Following the benchmark cryptocurrency’s firm rejection at $12,000 this past weekend, it has largely been consolidating within the lower-$11,000 region.
Yesterday, however, bulls attempted to spark a fresh leg higher. They sent BTC to highs of $11,500 before losing their momentum. From here, it retraced back to its $11,000 support level.
This recent price action has resulted in the formation of a bearish “head and shoulders” pattern that can be seen while looking towards the cryptocurrency’s 4-hour chart.
This technical pattern is historically bearish, and it will require a massive influx of fresh buying pressure for it to be invalidated.
That being said, while looking towards Bitcoin’s Fibonacci levels, it is still a strong possibility that BTC targets $13,000 next.
One analyst explained that it might first need to retest its crucial support at $10,500 before this can take place.
Bitcoin Forms Bearish Technical Structure as Momentum Slows
At the time of writing, Bitcoin is trading down just under 1% at its current price of $11,170.
BTC has been trading around this level throughout the past several hours, with its recent rejection at $11,500 throwing it into yet another consolidation phase right above its key near-term support level.
The cryptocurrency’s strength has been degrading slightly as of late due to the series of rejections it has posted.
The first rejection at $12,000 came about this past Saturday, and all subsequent attempts to rally up towards this level have been met with heavy selling pressure.
This has culminated in the formation of a bearish “head and shoulders” pattern that can be seen clearly while looking towards its 4-hour chart.
One analyst spoke about this in a recent tweet, saying that a “4h BTC H&S developing” while offering a chart showing the technical formation.
Image Courtesy of Josh Olszewicz. Chart via TradingView.
If Bitcoin breaks below the neckline of this pattern – which exists around $11,000 – the cryptocurrency could start reversing its recent gains.
Here’s the Path Forward for BTC to See Another “Moon Mission” to $13,000
Despite the emergence of this bearish technical pattern, one analyst said in a recent tweet that he believes the cryptocurrency could still be well-positioned to climb higher.
While pointing towards Bitcoin’s Fibonacci levels, the trader explains that a retest of its 0.786 level – at $10,500 – could spark a fury of buying pressure that catalyzes a movement to $13,000.
“Retest of 0.786 ( 10.5k ) before moon mission to 13k?”
Image Courtesy of Teddy. Chart via TradingView.
How the crypto trends in the coming hours will likely provide significant insight into its near-term outlook.
Featured image from Unsplash. Charts from TradingView.