Bitcoin Price: Why Today’s Weekly Close Is Crucial to Avoid $8,000s May.24.2020

Bitcoin Price: Why Today’s Weekly Close Is Crucial to Avoid $8,000s

MARKET UPDATE

Bitcoin Price: Why Today’s Weekly Close Is Crucial to Avoid $8,000s

May.24.2020

by Horus Hughes

Bitcoin price needs to secure a weekly close above $9,300 to avoid dropping below the ascending channel to revisit lows below $8,800.

Bitcoin Price: Why Today’s Weekly Close Is Crucial to Avoid $8,000s

Bitcoin price needs to secure a weekly close above $9,300 to avoid dropping below the ascending channel to revisit lows below $8,800.

MARKET UPDATE

As the weekly close approaches Bitcoin (BTC) price made a quick move toward $9,300 after spending the past 48-hours struggling to hold above $9,200. Traders would like to see the top-ranked asset on CoinMarketCap close above the $9,300 level and earlier this week Cointelegraph contributor filbfilb cautioned that:

If Bitcoin is unable to reclaim the levels aforementioned, the likely inevitable breakdown would be to retest the May lows and 20-week MA, currently around $8,160. Typically this is the line in the sand between continuation higher and a more meaningful bearish downturn.

Crypto market weekly price chart. Source: Coin360

As mentioned in a previous analysis, Bitcoin price continues to bounce off the ascending channel trendline but sustaining above the 20-day moving remains a challenge. On the 4-hour chart we can see the Bollinger Bands tightening and within the last hour the price pushed above the 20-MA on a low volume move.

BTC USDT 4-hour chart. Source: TradingView

The upper Bollinger Band is currently located at $9,449, just a few dollars away from $9,500 which has served as an important support and resistance zone. Currently the RSI is rising toward 50 and the MACD has pulled above the signal line.

The Chaikin Money Flow oscillator has also surged above 0 but what remains to be seen is sustained purchasing volume to support the current move toward $9,300.

BTC USD 4-hour chart. Source: TradingView

If Bitcoin can manage a 4-hour close above the $9,300 level, traders will shift their sights toward $9,600. On May 23 crypto market analyst Micheal van De Poppe posted the above chart and explained that:

If such a move occurs, a retest of the range high between $9,800-10,100 is likely as the next step. As this level has been tested many times already, the resistance level should be weaker as a rule.

It’s somewhat important to remember that it is a holiday weekend in the U.S., meaning traditional markets will be closed on Monday in observance of Memorial Day.

Generally crypto trading volume thins out on the weekend and the closure of major markets on Monday means the crypto market will trade without the influence of the S&P 500, Dow and futures markets.

For the time being, investors are looking weekly close above $9,300 or a retest of lows in the $8,800-$8,550 one is expected. In the event that Bitcoin loses the $8,550 support there is a risk of the price dropping to a wider range from $8,200 to $7,400.

Bitcoin daily price chart. Source: Coin360

As Bitcoin spent the last 48-hours shifting in a tightening range, traders shifted their attention to a few of the top-10 altcoins. Tezos (XTZ) added 2.56%, Ether (ETH) held on to its recent recovery to the $200 range by gaining 0.78%, and Ethereum Classic (ETC) rallied by 3.48%.

According to CoinMarketCap, the overall cryptocurrency market cap now stands at $257.8 billion and Bitcoin’s dominance rate is 66%.

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