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Bitcoin Rejected At $21K, Why A Retest Of The Lows Could Be Positive

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Bitcoin appears to be on the verge of retesting previous levels of support. The number one cryptocurrency is experiencing a steady decline that has led to a multi-year low around $17,000.

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| Two Months of Extreme Fear Caused Cryptocurrency to Panic, Bitcoin Worth $20K

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Bitcoin is trying to regain previously lost territory, but selling pressure continues due to negative news about the crypto space and changes in the monetary policy of the US Federal Reserve System (Fed). At the time of writing, the price of BTC is trading at $20,000 with a 10% loss over the past week.

Bitcoin BTC BTCUSD 1
BTC is trending down on the 4-hour chart. Source: BTCUSD Trading Review
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Analyst Mikael van de Poppe thinks BTC price remains in good shape after being rejected at $21,000. If the cryptocurrency manages to hold above $20,000, there is potentially more fuel for a bullish continuation. Via Twitter Analyst said:

Sweep lows and hold. As long as $20k holds, it should be good to break the previous high of $21k and then a higher high of $23k and possibly $24k is possible. Longs are still open.

Data provided by Material Indicators (MI) captures some support for bitcoin below $20,000. This suggests that the cryptocurrency may fall below its current levels.

However, Bitcoin orders are around $30 million and Bitcoin orders are around $19,000. This area should become a critical support in case of a further drop.

If those levels don’t work out, there are still $40 million in orders worth between $17,800 and $18,000 that could provide an additional layer of support. The order book looks thin below these levels.

BTC (blue line on chart) with $40 million stakes at around $18,000. Source: Significant indicators.

Above current price levels, over $20 million in sell orders alone are worth about $21,000. This level will continue to be a major resistance area and a hurdle for BTC price as it consolidates around this area.

Analyst at Material Indicators general the following about the hurdles standing between BTC and future growth:

So we are waiting for confirmation. Despite #TradFi sentiment and growth yesterday, the rally lost momentum before it could test the 200 WMA. The Fire Charts now show about $60 million of ask liquidity, located between this value and the 200 WMA range.

When will bitcoin hit the price bottom?

In this sense, analysts from MI emphasized that it is impossible to say with certainty when BTC will hit the bottom. However, there are certain clues that can help investors spot a downtrend in a bearish trend.

| Bitcoin Miner Liquidation Threatens Bitcoin Recovery

For example, the price of BTC usually bottoms out and then goes into a long period of consolidation. The analyst stated via Twitter, not ruling out another downfall:

the market is too late to rally, and the fact that moves to or below the 200 WMA have historically led to bull markets, we cannot confirm this until the price regains key moving averages starting from the 200 Weekly MA.

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