After an extended period of trading sideways around $8,800, Bitcoins bears have been able to push the cryptocurrency lower and put it at risk of breaking below multiple key support regions that have been bolstering its price.
Analysts are now widely noting that BTC is currently sitting at a key short-term support level that bulls appear to be ardently guarding, and any dip below this level could spark a major sell-off that leads the crypto back down to its previous key support levels in the $7,000 region.
Bitcoin Inches Lower, But Bulls Still Have Notable Strength
Bitcoin has been caught within a firm uptrend throughout 2020, recovering from lows of $6,800 that were set early in the month and rapidly surging up towards highs of $8,900, which is where the rally began showing signs of stalling.
Many analysts had noted that BTC’s ability to hold steady around $8,800 was a bullish sign, as its bout of sideways trading at this level could have marked a period of bullish consolidation.
Unfortunately, however, today’s dip towards $8,600 seems to have invalidated this bull-favoring possibility and may spell trouble for what’s to come next.
Jonny Moe, a popular cryptocurrency analyst on Twitter, explained in a recent tweet that BTC is currently trying to “scrape together” an ascending triangle formation, although it is increasingly unclear as to whether this will result in any sort of near-term relief.
“$BTC trying to scrape together an ascending triangle for continuation. I don’t love how shallow the angle of the bottom line is, but it’s there,” he explained.
This isn’t the only bullish thing currently going for Bitcoin despite its recent sell-off, as it also appears that it could be forming a bull pennant after bouncing at a key support level.
Big Cheds, another popular cryptocurrency analyst on Twitter, spoke about this, explaining that he is closely watching to see how the cryptocurrency responds to this support level on its 4-hour candle chart for insight into where it goes next.
“$BTC #Bitcoin 4 hour so far so good,” he concisely noted while referencing a support level at roughly $8,600.
If BTC continues holding above this support and begins inching back towards $8,800, it could mean this recent sell off will be followed by further upside.