False Breakout Revisited? Bitcoin Tests Critical Support Level

Today’s analysis focuses on Bitcoin, which has experienced a dramatic decline after reaching new all-time highs on January 20. Since then, the cryptocurrency has dropped significantly, falling to levels well below $100,000. Early today, Bitcoin touched a critical horizontal support level at $91,000, marked in blue on the chart.

This key support level has been in place since the end of November, providing a crucial floor for price action. It has been tested multiple times, including a false breakout on January 13, which resulted in a strong buy signal and a sharp recovery. Once again, Bitcoin bounced significantly off this support during the late Asian session, giving renewed hope to buyers.

As long as the price remains above the $91,000 support, the sentiment will remain positive. This bounce could offer a buy opportunity for traders seeking to capitalize on a potential rebound. However, it is a simple and critical setup:

• Staying above $91,000 keeps the bullish sentiment alive.
• A break below the blue support and a daily close beneath it would confirm a sell signal, indicating the likelihood of further declines.

With Bitcoin currently at a pivotal level, traders should watch how the price behaves around this support throughout the day and in the days to come.

Source: https://www.axiory.com/analytics/technical-analysis/false-breakout-revisited-bitcoin-tests-critical-su