It is important to note that in the time following this rally, BTC has made multiple attempts to break above the resistance that exists at this level, with each one resulting in firm rejections.
This has led multiple analysts to note that a significant breakdown could be imminent, potentially leading the largest crypto by market cap to decline back towards its yearly lows.
Bitcoin Enters Another Consolidation Phase as Heavy Resistance Mounts
At the time of writing, Bitcoin is trading up marginally at its current price of $6,630, which marks a slight decline from highs of $6,900 that were set earlier this morning.
Each bid to break into the $7,000 region has been met with intense selling pressure, with the rejection seen here earlier this morning marking the third one that the crypto has seen around this price over the past day.
The rejection here has led Michaël van de Poppe, a popular cryptocurrency trader and analyst on Twitter, to tell his followers that he anticipates BTC to see a sharp movement down towards $4,800 in the near-term.
“Bitcoin: A swift rejection here at $6,900. It can still hang around this area for a bit. If we break back above $6,650, I’m expecting another tap of the $6,900-7,000 area. However, all-in-all, remaining to expect $5,400 and $4,800 to be tested in the coming period,” he noted.
A swift rejection here at $6,900.
It can still hang around this area for a bit. If we break back above $6,650, I’m expecting another tap of the $6,900-7,000 area.
However, all-in-all, remaining to expect $5,400 and $4,800 to be tested in the coming period. pic.twitter.com/2eiAHUEadO
— Crypto Michaël (@CryptoMichNL) March 25, 2020
BTC’s Macro Market Structure Showing Signs of Degradation
This near-term technical weakness has also led Bitcoin’s macro market structure to begin showing signs of weakness.
Jonny Moe – another popular analyst – told his followers that he is patiently awaiting a breakdown from an ascending wedge that the crypto has been forming over the past couple of weeks.
“Still watching, waiting. Sure looks like we’re getting close. Note descending volume profile.”
Still watching, waiting. Sure looks like we’re getting close.
Note descending volume profile.$BTC pic.twitter.com/IMTX4i4bDE
— Jonny Moe (@JonnyMoeTrades) March 25, 2020
The pattern he references above is highly bearish and could open the gates for significant downside once BTC posts a confirmed breakdown below its lower boundary.
Furthermore, Bitcoin’s declining volume profile suggests that the crypto is gearing up to make a massive movement. While considering this confluence of bear-favoring factors, it is probable that this next movement will favor sellers.
Featured image from Shutterstock.