Bitcoin (BTC) fell below the horizontal support area of $ 46,300, but still holds close to the long-term support of $ 44,300.
In the early hours of January 6, the price of BTC declined significantly, falling as low as $ 42,500. This drop caused it to pass below the horizontal support zone of $ 46,300, which had been in place for 32 days.
A break below this kind of long-term support zone is a very bearish move.
Bitcoin’s price is now approaching its September high of $ 42,000.
Bitcoin’s current decline
Looking at the trend in more detail, it can be seen that while the volume was significant (red arrows), it was however considerably lower than the December 4th decline.
Additionally, BTC appears to be following a downward support line. So far, he has validated this line four times (green arrow), the most recent dating from January 6.
As long as it is trading above this line, the possibility of a bounce and a reversal remains high.
In this case, the $ 46,300 area should now serve as resistance.
Long-term movement of the course
The daily chart shows that Bitcoin is trading slightly below the support area of $ 44,300 which is created by the support of the 0.618 Fibonacci retracement.
For the long term uptrend to continue, it is imperative that BTC does not close below this level.
In addition, the uptrend of technical indicators has not yet been canceled. Bullish divergences are present in both the MACD and the RSI.
So, until both indicators hit a lower low and cancel out these bullish divergences, the possibility of a reversal remains high.
A continued decline in the BTC price would likely cause the two indicators to cancel their divergences and cause the price to decline below the long-term support of $ 44,300.
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