Bitcoin Faces Fifth Consecutive Rejection at $72,000: Another Correction on the Horizon?
Bitcoin’s Stumble at $72,000: A Sign of Correction?
Bitcoin (BTC) has once again failed to solidify the $72,000 mark as a support level, marking its fifth consecutive rejection at this resistance. Despite the recent drop, some analysts remain optimistic, highlighting potential for an upcoming breakout and identifying key levels to watch.
After a robust rally in ‘Uptober,’ Bitcoin surged approximately 13% in the last 30 days, pushing its price from a monthly low of $58,900 to nearly its all-time high (ATH) of $73,737. While the flagship cryptocurrency is poised for its best monthly close since March, potentially registering between 13% and 14% in monthly returns, its recent price action has introduced some uncertainty.
On its whitepaper’s 16th birthday, Bitcoin experienced a spooky 2% drop, pulling the rest of the market down into a red Halloween party. BTC’s price fell below the $71,000 mark, hitting an intraday low of $70,600. Ethereum (ETH), the second-largest cryptocurrency by market capitalization, mirrored this decline, losing the $2,600 support zone with a 5.1% pullback.
Crypto analyst Ali Martinez pointed out that this latest drop marks the fifth consecutive rejection Bitcoin has faced at $72,000. In the four previous instances, Bitcoin experienced declines ranging from 8.2% to 18% after being rejected at this resistance level.
Analyst Altcoin Sherpa suggested that a 4% to 5% dip could be on the cards if Bitcoin fails to hold the $70,000 support zone. However, Sherpa maintains that the cryptocurrency should “see some sort of bounce” from the $70,800-$71,400 area in the near term.
The week ahead is expected to be highly volatile for Bitcoin, leading up to the US presidential elections. Bitfinex analysts predict a peak in Bitcoin volatility between November 6 and November 8, attributing this to speculation and anticipation surrounding the election outcome.
Is Bitcoin Primed for a Year-End Breakout?
Cryptoinsightuk delved into Bitcoin’s performance, noting that BTC remains at its ATH by Open Interest (OI). The crypto investor suggests that the Daily Relative Strength Index (RSI) could potentially “cross bearish” today. They also emphasize that $69,600 should act as a key support level for Bitcoin bulls but warn that losing the $66,500 range could lead to a “messy” situation as BTC’s open interest would “flush.”
In contrast, Crypto Kaleo offers a more bullish outlook for Bitcoin’s price action. The analyst highlights that Bitcoin initially pulled back nearly 20% during Thanksgiving in 2020, moving from $19,400 to $16,100, after retesting the $20,000 mark without breaking above its ATH.
Furthermore, BTC’s price consolidated within that range for 30 days before experiencing a breakout, initiating the next leg up in late December 2020. Notably, this breakout occurred 219 days after the May 2020 Halving. With Bitcoin currently 194 days post-halving, the analyst considers that “a little bit of a pullback here isn’t any reason for concern.”
As of this writing, Bitcoin has maintained the $70,000 support level, currently trading at $70,522. The coming days will be crucial for determining whether this recent pullback signals a correction or simply a temporary dip before a potential year-end breakout.
Featured Image from Unsplash.com, Chart from TradingView.com