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Bitcoin drops to 14 days lows as $6B in options about to expire
Bitcoin has breached its recent support level of $53,000 as uncertainty rises ahead of a record options expiry case.
Bitcoin’s (BTC) price has fallen by 20% since its previous all-time peak of $62,000 in mid-March. Since crypto stocks are notoriously unpredictable, this may be yet another standard pullback during the ongoing bull period.
Since stocks cannot rise in a straight line, corrections are needed to produce support for more upward momentum. Furthermore, a whopping $6 billion in option expiration is due on March 26, which usually results in any uncertainty.
It is also normal for the market’s direction to change after the options expiration date has passed.
$53K level has to become support to gain bullish momentum
Since the latest all-time high of $62,000, the 4-hour chart has shown an obvious downtrend with bearish support/resistance flips.
Regardless, Bitcoin’s price has refused the crucial resistance zone at $56,500 in the most recent rally after Tesla’s announcement that it has begun accepting (and holding) BTC in the United States for its cars. As the price index was unable to break higher, new checks of the $53,000 support zone were unavoidable.
Given that the $53,000 funding zone has been checked many times in recent weeks, it became more possible that this amount will not hold this time. As a result, on March 25, the stock fell to as low as $51,500.
As a result, Bitcoin’s price must now re-enter the $53,200-$53,800 range in order to re-establish some bullish traction in the immediate term. If that doesn’t happen, the price is expected to slip lower to the next support zone between $49,500 and $51,500.
Overall structure still heavily bullish
The daily chart of BTC/USD continues to paint a bullish image, with higher lows and higher highs. In that case, a correction to as low as $44,000 will also indicate that the bullish thesis is still true.
In this respect, Bitcoin’s price is currently firmly supported between $49,500 and $51,500 and is unlikely to sink any further.
Furthermore, the bearish divergence will not be proven until the market makes lower lows and lower highs below $44,000, as previously reported.
Dollar showing strength
The US dollar is gaining momentum once more, though yields are rising significantly. As a result, it’s not shocking to see risk assets, such as commodities and cryptocurrencies, dropping.
A rising USD is traditionally bearish for cryptocurrency markets, particularly in the short term. However, the recent increase in the dollar is expected to be short-lived because it is approaching high resistance. Furthermore, the structure also displays lower lows and lower peaks, implying that a trend reversal is imminent.
As a result, if the dollar’s momentum is disrupted, blockchain prices and more gains for Bitcoin are probable.
A possible scenario for Bitcoin
Bitcoin’s 4-hour chart indicates a downtrend, implying that a retest of the $53,200-53,800 range would be refused. As a result, in the short term, more downside is the most possible possibility in this current price building.
The green zone in the map above is the field to keep an eye on for a possible bullish deviation or instant rebound. If such a move happens, the bulls’ optimal scenario will be to establish a higher low.
Once such a higher low is established, Bitcoin’s price will be set to rise further, with the next levels of interest at $68,000 and $82,000.