Will Bitcoin price test $20,000 again?

Bitcoin price shows clear signs of distribution occurring on the four-hour chart, which indicates the possibility of a trend reversal. Moreover, BTC has been consolidating for more than two weeks with no direction in sight, making it a perfect place to form a local top.

Bitcoin price edges closer to a sell-off

Bitcoin price has produced all the signs required to confirm a distribution pattern. This formation occurs after a rally and indicates top formation, where investors that accumulated before or during the uptrend distribute or offload their holdings. 

The perfect place to short would be at $24,000 on February 1, when Bitcoin price swept the January 29 swing high at $23,966. This key liquidity run was a pivot point and BTC has shed roughly 6.30% so far.

Another confirmation of a downswing will occur after Bitcoin price breaches the daily support at $22,780 and flips the $22,277 support level into a resistance barrier. In such a case, BTC could slide lower to retest the next daily support at $21,269. In case the selling pressure persists here, the big crypto could tag the four-hour support level at $20,847.

BTC/USDT 4-hour chart

While the pessimistic outlook makes sense from a technical perspective, investors need to note that a flip of the $23,373 hurdle into a support floor will be key to denouce the bearish bias. This move in Bitcoin price will invalidate the bearish thesis and potentially trigger a run-up to the next key level at $23,496.

A decisive flip of the $25,000 psychological level would be key to continuing this ongoing rally. This high timeframe confirmation in Bitcoin price could trigger a run-up to $30,000.