Yesterday you might remember I posted that the 12h charts showed signs indicating sellers were overextended; we were on our 8th day under the 12h 20 and 10 DMA; and the last time we saw that was in the COVID black swan crash (10 days under). The market is not as fearful as that event, and our analysis was proved correct as the price suddenly rallied, with healthy , and closed the 12h candle over both MAs. BTC also confirmed support on the next (current) 12h candle and is currently bouncing from them.
With support confirmed at the 12h 10 DMA and 20 , the bulls also closed over the Daily 10 DMA and confirmed support on the next (current) daily candle. Bull’s next target is the Daily 20 , immediately overhead, it will take a rally to $32.8k to close over it.
☙ January close price S/R at ~$33k
☙ The 10 year Channel 2 S/R (the purple line) at around $34.6k (overlaps with the June distribution
overhead resistance at the same range)
☙ The daily 200 at $38.6k currently
☙ The psychological barrier at $40k
On the other hand, if we reject any of these, first we watch for the level of retracement – we may not break through resistance on the first try – but also monitor for possible strong rejections and selloff. Weak retracements (say 38% or less) can be a show of strength and may indicate better odds of rallying after the correction. If we see price collapse at this range, I suspect another test of the December close support will be awaiting us.