Bitcoin price needs to pullback before BTC explodes to $20,000
- Bitcoin price pulls back to $17,130 after a 3.3% drop.
- A continuation of the downswing is likely, until BTC reaches $16,500.
- Invalidation of the bullish thesis will occur on the breakdown of the $15,984 support level.
Bitcoin price shows a clear start of a corrective wave in its journey to retest a critical hurdle. This pullback is necessary as it allows buyers to recuperate and kick-start a new leg-up.
Bitcoin price sticks to the plan
Bitcoin price has rallied 9% in the last six days and has set up a local top at $17,430. As a result of this, BTC is undergoing a retracement that seems to have paused around $16,881. Investors should expect a continuation of this downtrend, sending the big crypto down to subsequent support levels at $16,709 and $16,545.
A bounce off the $16,545 barrier is likely where Bitcoin price will form the third higher low. The resulting uptrend will propel BTC to the first significant hurdle at $17,593, which is where the big crypto formed a bottom after the crash in June.
Flipping this hurdle into a support floor will open the path for Bitcoin price to reach the next important resistance level at $19,235, which saw the highest volume traded in 2022, also known as Point of Control (POC).
Although unlikely, in some cases, Bitcoin price might retest the $20,000 psychological level with the help of residual bullish momentum.
BTC/USDT 1-day chart
Regardless of the bullish outlook, if Bitcoin price fails to stay above $16,545, it will be the first sign of weakness among buyers. A lack of cohesive bullish momentum could knock BTC lower to the subsequent support level at $15,984.
A four-hour candlestick close below this level will invalidate the bullish thesis for Bitcoin price by producing a lower low. Such a development could see the big crypto crash to $15,443.
Author
Akash Girimath
FXStreet
Akash Girimath is a Mechanical Engineer interested in the chaos of the financial markets. Trying to make sense of this convoluted yet fascinating space, he switched his engineering job to become a crypto reporter and analyst.
