Bitcoin, the world’s largest cryptocurrency, staged a remarkable rally in March despite the fallout from several U.S. banks. However, the coin stalled at a 10-month high around $29,200 and is currently consolidating ahead of another breakout, but this time investors are backing for highs above $30,000.
“Following the fallout from several U.S. banks last month, Bitcoin staged a rally that took it from around $20,000 to $28,000 in a matter of days,” Bloomberg Crypto wrote in a recent Twitter post, adding. “However, the coin appears to have stalled its rally to $28,000.”
All eyes on $29,000 as Bitcoin price searches for support
Over the past 24 hours, Bitcoin’s price has fallen 1.8% to $28,064 as of Thursday’s writing. Its 24-hour trading volume has reached nearly $15 million.
Some experts believe that the sideways and choppy market is mainly due to shrinking trading volumes in the crypto market as small retail traders wait on the sidelines for BTC price to break the deadlock between bulls and bears and determine its next move.
The daily chart shows that Bitcoin price is trading in a narrow range with support at $27,000 and resistance around $29,000. A breakout on either side of the range will end the consolidation.
The $28,000 region operates at a critical level, with BTC swinging up and down to test range resistance and support. According to popular analyst Michael van de Poppe, “#Bitcoin’s $28,600 price level remains resistance,” he told his 652,000 followers via a tweet Thursday morning.
Poppe believes that the current market structure limits the ability of Bitcoin’s price to rise to $30,000, at least not immediately. In his view, “you want to see support again” around $27,600.
“If this scenario holds true, we will bounce back and continue until we test $27,600 or $28,600 again,” Poppe added.
Selected indicators applied to the daily chart below suggest a path of least resistance in the short term, starting with a sell signal confirmed by the Moving Average Convergence Divergence (MACD) indicator.
Despite the confirmed buy signal, investors who want to take a short position in BTC must be cautious and consider waiting until the coin breaks below the immediate support of $28,000 and breaks below the accelerating dotted uptrend line.
Has the bull market begun?
According to CryptoQuant, one of the leading on-chain analytics platforms, Bitcoin is “still a long way from a bull run.” In its latest Twitter post about the performance of the largest cryptocurrency, the platform quoted one of its verified authors, Crazzyblock, who said:
“Based on#Bitcoinprice cycles in 2015-2016 and 2018-2019, when realized prices in the 1m-6m age bracket exceed realized prices in the 6m-12m age bracket, after a pre-bull market price correction, the bull market begins.”
There is no guarantee that the 200-day MA support will absorb all the selling pressure. While BTC has performed extremely well over the past few weeks despite being bombarded by increasing regulatory pressure from the U.S., retail traders holding positions during the current consolidation may want to avoid capitulation in case BTC starts to trim gains.
That said, panic selling could complicate the Bitcoin price structure, leading to another drop to $24,000 before another aggressive attack on the $29,000 resistance level to achieve the coveted breakout above $30,000.
Bulls may have to wait for Bitcoin price to find strong support and sweep in new liquidity to keep the uptrend going. MACD maintains a bearish outlook on the four-hour timeframe, as it does on the daily chart.
There are three key levels that investors should be watching on Thursday, firstly the range resistance at $29,000, range support at $27,000 and more importantly the critical level at $28,000.
A break below the uptrend line could pave the way for a break below the earlier established 200-day moving average. On the upside, a sustained breakout and hold above the $29,000 range limit could be BTC’s ticket to over $30,000.