After an extended period of trading sideways around $7,200, Bitcoin’s bears have once again gained control of the cryptocurrency and have sent to a key support level. BTC’s bulls have so far been able to defend this level, but it remains unclear as to whether it will continue to hold as the weekend continues on.
One analyst is noting that the current support level Bitcoin is trading at is a “pivotal level” for the cryptocurrency, and how it reacts to this level could set the tone for which direction it heads throughout the first part of 2020.
Bitcoin Plummets to $7,000 As Bears Build Momentum
At the time of writing, Bitcoin is trading down over 2% at its current price of $7,100, which marks a notable decline from its daily highs of $7,300 that were set yesterday.
Today’s decline has led the cryptocurrency down to a key support level that has been holding strong in the time since the crypto plummeted to lows of $6,500 in late-November. In the time since BTC bounced from this level, it has not dipped below $7,000, as bulls have been ardently defending this level.
Importantly, this level appears to be much more than just a near-term support level, as TraderXO, a popular cryptocurrency analyst on Twitter, explained in a recent tweet that a close below this level could place BTC in a firm downtrend that sends it down to $6,500.
“$BTC – Pivotal level,” he concisely noted while pointing to the chart seen below.
$BTC – Pivotal level pic.twitter.com/LSB4aIKeE1
— TraderXO (@TraderX0X0) December 14, 2019
Analyst: BTC Requires Daily Close Over $7,300 for Bull To Take Control
If bulls want to turn this ongoing drop around and help lead the cryptocurrency back to the mid-$7,000 region, it is imperative that they push the crypto back to $7,300.
Josh Olszewicz, another popular cryptocurrency analyst on Twitter, spoke about this key level in a recent tweet, also explaining that Bitcoin’s current price action favors the possibility of further bearishness.
“1D $BTC: @bbands. only this tight a few times over the past year. currently w/bearish forecast. price > 7300 would be above 20SMA which would flip sentiment bull. eventual resolution of all moves of this caliber have resulted in initial 20%+ price swing,” he noted while referencing a chart showing that a big movement could be imminent.
1D $BTC @bbands only this tight a few times over the past year
currently w/bearish forecast
price > 7300 would be above 20SMA which would flip sentiment bull
eventual resolution of all moves of this caliber have resulted in initial 20%+ price swing pic.twitter.com/VorbN1XpjJ
— Josh Olszewicz (@CarpeNoctom) December 14, 2019
The coming couple of days may offer insight into which direction Bitcoin will trend going into 2020, as a break below $7,000 could spark another major downtrend that leads to significantly further losses.
Featured image from Shutterstock.
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