Bitcoin prices fell from a high of USD 69,000 all the way to a current price just above USD 40,000. This 40% decline within 2 months definitely took a toll on crypto investors. The ones who opened positions higher than a Bitcoin 40K price are currently in the red. On the other hand, Bitcoin’s technical formation is showing a sign of a potential reversal. Should you buy Bitcoin at today’s price of around 40K? Let’s see where the crypto market is currently at, and lay a trading setup.
Bitcoin Lost 40% in 2 months – Is the Downtrend Over?
It is true that Bitcoin prices started to freefall on the 10th of November 2021. In fact, good technical traders knew about this downfall since the 3rd of December. This is when Bitcoin prices breached the average uptrend deeply lower than anticipated. In figure 1, we can clearly see this break thanks to the red circle on the chart.
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Bitcoin 40K – Should you Buy Bitcoin at that Price?
Well, it all depends on your strategy. But most traders and investors are interested in buying a Bitcoin 40K price. The reason comes from both a technical and fundamental angle:
- Most big tech and big firms entered the crypto market buying Bitcoins around that price. If the market was to rebound, the current price would be the perfect opportunity to do so.
- From a technical angle, prices hit a very strong support level. As shown in figure 2, prices did rebound from the 40K area several times in the past. Currently, it seems as if prices are prepping from a reversal.
When plotting the Fibonacci retracement, we can clearly see how the strong support of 40K highlights other psychological prices and give importance to the 50K area. If prices were to reverse upwards, they have to first reach a price of USD 43K for confirmation. If successful, we might be able to see a price of Bitcoin around 50K again, or a 20% gain. On the other hand, if prices fell below 40K, this is a huge indicator that the bear market is continuing lower.
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The Crypto Market at a Glance
In the past 24 hours, the cryptocurrency market continued dipping further lower. Sunday mornings are usually slow days for the crypto market. Despite Bitcoin consolidating for the day, other cryptos lost on average -1.48%. The top losers are ROSE, FTM, and NEAR losing respectively -15%, -12%, and -11%. On the other hand, the top gainers are ICP, LEO, and LINK gaining respectively +7%, +5%, and +4%.
1- Bitcoin (BTC) : + 0.06%
2- Ether (ETH) : – 2.75 %
3- Tether (USDT) : 0 % (surpassing BNB)
4- Binance Coin (BNB): – 4.45 %
5- Solana (SOL) : – 3.36 %
6- USD Coin (USDC) : + 0 % (surpassing ADA)
7- Cardano (ADA) : – 5.73 %
8- Ripple (XRP) : – 2.21 %
9- Terra (LUNA) : + 4.90 %
10- Polkadot (DOT): – 2.11 %
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Rudy Fares
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