Bitcoin turned back below $20,000 after the sell-off that followed the completion of the Ethereum merger. With the decline, the digital asset returned to lows not seen in three months, giving confidence to bears during this time. However, one problem remains, and that is the fact that the cryptocurrency failed to find suitable support, causing the downtrend to continue.
Bitcoin price drops to a minimum
Over the past week, Bitcoin has seen several drops in its price. The Ethereum Merge turned into a “buy the rumor” event that led to massive accumulation across the crypto market. But soon after, prices fell, and Bitcoin fell back below $20,000.
What this did was send the pioneering cryptocurrency back towards the lows of the range. Touching just above $19,000, it fell to three-month lows with levels not seen since June this year. Since then, Bitcoin has struggled to hold above $18,000 and not fall to the June lows.
BTC falls to three-month lows | Source: BTCUSD on TradingView.com
The current price decline is a byproduct of Bitcoin’s inability to break $22,500. The test at this point resulted in a defeat that sent his price back to $18,000. After this decline, the digital asset was able to recover, but only slightly. Once again, it moved back to $18,000, where the bears continue to hold the fort.
Pushing to 2018 levels
Even now, the price of Bitcoin remains in a more favorable position compared to the previous day of the bear market cycle. Bitcoin’s current price of just above $19,000 puts it squarely in the consolidation range between $17,500-$25,000 that has held for the past three months.
However, given the digital asset’s recent decline, it shows a draw to the previous bear market cycle, which would see it bottom at $12,000 if the trend continues. Additionally, the sell-off has continued over the past few weeks and digital assets have come under considerable pressure at this point.
Continued consolidation in these bands has shown that there is major resistance at $22,500 and then $25,000. This explains the fall in the price of Bitcoin after it tested the first, which proved to be a point to overcome in any recovery trend.
If Bitcoin fails to hold above $17,500 and falls below that point, then Bitcoin will hit a low of $12,000 before the bull market. However, if there is a significant uptrend that takes the price of the digital asset above $25,000, indicators show that this point will lead to an upside breakout.
Featured image from MARCA, chart from TradingView.com
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