Bitcoin price is attempting to re-enter the bullish ascending triangle pattern that it exited out of last Friday, August 21, when the asset unraveled $500 in 24 hours.
This previous key support, which had helped prop up Bitcoin over eight times since July 28, 2020, is now acting as a strong resistance on the 4-hour chart and is preventing bulls from surpassing the $11,800 level.
Looking at the total crypto market cap, it appears that we have just set a new lower high at $369 billion, according to data on Coinmarketcap, and are now about to start the next leg down. This strongly suggests that more bearish activity is coming over the course of this week unless significant volume picks up and breaks the next critical resistance.
BTC: Price Levels to Watch in the Short-term
The aforementioned resistance at $11,800 is proving difficult for intraday bulls to overcome right now.
The 50 EMA (blue line on the following chart) is currently securing the price against further decline but if selling pressure continues to bite away at the current uptrend, we could see a reversal drive prices back down through the 100 EMA (red line) and towards the main support zone below (green) at $11,400.
Bitcoin recently visited this particular level last Saturday, August 22, and was able to rebound strongly after dipping into the oversold region on the 4-hour RSI (the yellow dots). This would have likely triggered a large number of trading bots to buy back into Bitcoin and helped to initiate a new uptrend.
This should act as a strong support again if prices are forced back during the intra-week trading session.
Looking beneath this support though, we have the second major support zone around the psychological $11K level, and an order block support between $10,260 and $10,160. If we see prices dramatically fall to this zone then we should also watch out for the lingering, unfilled CME gap below at $9,925 – $9,665.
From the bullish side, if prices break the current sloping resistance, then the $11,940 area stands out as a likely price target before the all-important $12,000 level. From there, the $12,400 and $12,800 will continue to be the main bull run targets.
Total market capital: $380 billion
Bitcoin market capital: $216 billion
Bitcoin dominance: 56.9%
*Data by Coingecko.
Bitstamp BTC/USD 4-Hour Chart
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Source: Crypto Potato