Bitcoin (BTC) price has dropped from $ 58,000 to $ 44,000 in the past few days. Panic sales started to be observed in the markets during the week when the price eased.
The Crypto Fear and Ambition Index, which recently went above 90, dropped to 38, the lowest in the last three months.
Crypto Fear and Ambition Index. Source: Alternative.me
Analysts say such panic sales are out of place. According to Cointelegraph analyst Michael van de Poppe, it is normal to see such “reset” movements in bull market processes. Saying that these declines are “organic and healthy”, Poppe argues that they offer investors the opportunity to buy from the bottom.
Refusal of $ 52,000 points to weakness
4-hour chart of the BTC / USDT pair. Source: TradingView
Looking at the 4-hour chart, there is a significant decline since the peak at $ 58,000. If the correction process continues, this peak could be the highest in the next months. On the other hand, since the $ 58,000 high, the support levels are turning into resistance and the peaks are decreasing. This is an indicator of weakness in the market.
The chart in the short time frame reveals that the bitcoin price forms around $ 43,000 support zone. Keeping this support zone possible could make a leap towards $ 52,000. If it fails, a decline to $ 37,500 to $ 39,000 can be seen.
Uptrend still intact
Daily chart of the BTC / USD pair. Source: TradingView
While low timeframes indicate weakness in the BTC / USD parity, higher timeframes indicate a healthy correction. As seen in the chart above, the market structure is still optimistic.
The previous peak was $ 42,000, and then $ 30,300 was set as the new support zone. This last peak was clearly broken when Bitcoin’s price reached $ 58,000. Therefore, even with a correction of up to $ 37,000, it may seem healthy and organic for the bull market.
Simply put, as long as the BTC price remains above the $ 30,000 level in January 2021, the market can be considered in an uptrend.
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