- Bitcoin returns into the $8,000 range after zooming to new January high at $9,184.
- Sideways trading between $8,500 and $8,750 is likely to take precedence in the near term.
Bitcoin led the cryptocurrency market on Sunday in an unexpected brief rally above the coveted $9,000 for the first time in 2020. The gains extended toward $9,000 but the high achieved was $9,184.
Unfortunately, a sharp reversal took place on the same day, pushing Bitcoin remarkably under $9,000. The tentative support at $8,750 did little to cushion BTC against the fall. Instead, Bitcoin extended the losses below the 50 SMA on the 4-hour chart and even tested the next support target at $8,500.
At the time of writing, a shallow recovery has occurred, pulling BTC above $8,600. BTC/USD is teetering at $8,647 and facing growing resistance. Correction towards $9,000 will not come easily based on the high concentration of sellers at $8,750. Besides, Bitcoin must fight to reclaim its position above the broken trendline support.
The Relative Strength Index (RSI), shows that momentum northwards is likely to stall. In other words, the sideways motion suggests the price is likely to range between $8,750 and $8,500 in the near term. Apart from the support at $8,500, other support levels include $8,250, $8,000 and $7,750.
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