Bitcoin’s ($BTC ): ATH Reversal Chance
Bitcoin’s struggleAs it approaches the 26 EMA, a critical level that is currently the last line of defense against a more significant decline, Bitcoin is treading carefully. Bitcoin has had difficulty maintaining its upward momentum after hitting new all-time highs earlier this year and recent price action indicates that a possible reversal may be imminent.
Bitcoin is located exactly on its 26 EMA which has historically served as dynamic support in strong bullish trends and is currently trading at about $104,600. But this time it goes beyond a technical level; it’s the final significant obstacle before a more significant correction. If this support fails the 50 EMA which is still below the crucial $100,000 mark is the next likely target.
There is technical and psychological significance to that sub-$100,000 level. In addition to destroying market confidence a decline below it might also lead to a larger wave of liquidations and pessimism. Since Bitcoins jump to its new ATH the 50 EMA hasn’t been tested in weeks and touching it now would indicate the largest retracement.
The macro backdrop is also exerting pressure: declining exchange reserves limit supply but do not supply enough fuel for bullish continuation. It may not be a temporary decline; rather it may signal the start of a complete reversal from the highs if bulls are unable to quickly regain ground above the 26 EMA. The setup is straightforward: either hold the 26 EMA or run the risk of falling to the 50 EMA. What happens to Bitcoin at this turning point will determine its future in the near future. A wider corrective phase may be replacing the ATH euphoria if it fails to hold.
