Bitcoin Consolidation May Signal ‘Bear Trap’ Downturn With Possible Rebound to $80,000

Bitcoin's price has rebounded to the $68,000 mark following a sharp decline. The intensity of the upcoming rally will decide if the consolidation phase has ended.

Source:www.trthaber.com

Bitcoin experienced a turbulent week, soaring to a fresh record peak of $73,777 before swiftly retracting all gains and plunging close to $64,500. At the time of reporting, Bitcoin seems poised to conclude the week with a slight decline of around 1% compared to the previous week's closing.

Analysts predict a modest correction, expecting strong buying interest from spot Bitcoin exchange-traded fund investors at lower levels. Thomas Fahrer, CEO of the crypto-oriented review platform Apollo, described the downturn as a "Bear Trap" on X. The robustness of the rebound will provide clearer insight into whether the correction has concluded or not. A feeble recovery suggests ongoing selling pressure from bearish investors, raising the likelihood of a more significant pullback. Conversely, a vigorous bounce signifies assertive buying at lower price points, bolstering the potential for the uptrend to resume.

Analysis Of Bitcoin Price

Bitcoin experienced a sharp correction from $73,777 on March 14th, breaching below the support line of the ascending channel pattern on March 16th. The bulls are attempting to halt the decline near the 20-day exponential moving average ($65,564). However, they are likely to encounter resistance at the breakdown level of the channel. A sharp reversal from the current level increases the risk of further downside.

Should the 20-day EMA support fail, the BTC/USDT pair may decline to $59,000, followed by the 50-day simple moving average ($55,303). To avert further decline, bulls must push the price back into the channel, signaling robust buying at lower levels. A breakout and close above $73,777 would signal a continuation of the uptrend, potentially propelling the pair toward $80,000.

The moving averages have recently formed a bearish crossover, although the relative strength index (RSI) has surged, suggesting a potential reduction in selling pressure. The 20-day exponential moving average (20-EMA) is expected to face a significant battle between bulls and bears. A sharp downturn from the 20-EMA would indicate that bears are capitalizing on rallies. In such a scenario, the pair could test the robust support level at $64,500. Further downside momentum could lead to a decline towards $59,000. The first indication of bullish momentum would emerge with a breakout and close above the channel's support line. This development could propel the pair towards resistance levels at $70,650 and subsequently $72,420.

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