Bitcoin price is struggling to break $ 7K, what's the worst case scenario?

The Bitcoin price has gone through a relatively stable week, as BTC / USD ranges between $ 6,000 and $ 7,300.

However, due to the low volatility, the volume also decreases, so it is expected that there will be a big move. What can one expect from markets while the Corona virus pandemic is causing devastating losses to the global economy?

Bitcoin is hovering in front of important resistance to create momentum up

Bitcoin price is currently facing the decisive resistance to create momentum. A strong break above the overhead resistance of $ 6,900-7,100 will be a positive sign, opening up the opportunity to reach $ 8K.

Bitcoin 1

BTC / USD chart 1 day | Source: TradingView

The reason is quite obvious. Bitcoin has retreated a lot in the past few weeks, after which the price slowly increased to nearly 100% from a recent low of $ 3,750.

However, there is no level of support - an indispensable component in the upward trend. The price of Bitcoin needs to regain old support levels to flip resistance to support and create a more optimistic outlook for the market.

Bitcoin price also fights the 100-week MA

Bitcoin 2

1-week BLX chart | Source: TradingView

Higher time frame charts need to be watched at this time, as they provide large levels of support and resistance.

The weekly chart is one of them, because the moving averages (MA) 100, 200 and 300 show significant levels of support and resistance.

Currently, the Bitcoin price has rebounded from the MA 300 week, closed above the MA 200 week and declined at the MA 100 weeks. The 100-week MA is an important factor to watch out for if the market wants to move higher.

A clear breakout of $ 6,900 (because it's near the 100-week MA) means the market reclaimed this MA as a support. Accordingly, the bull market will begin if the 100-week MA plays a supporting role.

However, losing the 200-week MA (about $ 5,400) will usually result in a move to the $ 4,000 area, around the MA 300 week. Such a decline certainly creates the cumulative period as witnessed in previous cycles.

The accumulation and passing periods will not be strange in the current economic environment with the Corona virus raging everywhere. However, if Bitcoin can regain the 100-week MA and rally, it will be a strong bull signal.

Total market capitalization also stumbled important resistance

Bitcoin 3

Chart tHe market capitalization of cryptocurrencies 1 week | Source: TradingView

Total market capitalization is showing clear view. A break and close above the $ 185-190 billion resistance will suggest a bull market and bring the $ 240, 300 billion resistance level into sight.

However, if the market turns red next week, the next test downtrend is entirely possible on the total capitalization chart.

The levels to watch are the 130 and 105-115 billion area. As discussed above, MA 300 weeks can play a key support role.

The MA is at around $ 117 billion, in line with the support levels. If the market decides to fall further, this level is the main area to look for.

Price increase scenario for Bitcoin Bitcoin 4

6-hour BTC / USD price advance chart | Source: TradingView

The bullish scenario for Bitcoin is currently quite simple. The chart is showing a clear downtrend line, which needs to be broken to support the bullish outlook.

Therefore, Bitcoin must maintain above $ 6,300-6,400 to be supported as the first step, then the next big step is to create a bullish breakout.

The moment Bitcoin decides to break out of the $ 6,900-7,100 resistance level can create a green candle worth $ 700-1,000, as there is plenty of room to spare until the next resistance at $ 7,800-8,000 .

The final step for the mass growth prospect will be to flip $ 6,900-7,100 into support. If successful, incremental momentum can be expected with the goals of $ 8,500, $ 9,300 and $ 10,400 thereafter.

Currently, a breakout above the resistance level is a great signal.

Discount script for Bitcoin

6-hour BTC / USD discount chart | Source: TradingView

The bearish outlook is still likely due to the current economic instability and the Bitcoin price trend is operating in the wedge of overall downtrend.

At the same time, with the recent decreasing volume, it is expected that the markets will have big movements. Combining all the factors with resistance, the downward move is most likely.

Therefore, if the price of Bitcoin fails to break above $ 6,900-7,100 (red zone), then a drop to $ 5,600-5,800 is expected. The move to follow then is to flip support / resistance.

If Bitcoin drops to $ 5,600 and rebounds immediately rejected at $ 6,300, it will continue to decline.

You can see the price of BTC here.

Disclaimer: This is not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.

Thuy Trang

According to Cointelegraph

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