Bitcoin price is falling after reaching a new historical record (ATH) of $34,800
The price of Bitcoin (BTC) reached a record $34,800 on Sunday, rising more than 34% in one week to start 2021 in beauty. The weekly outlook for cryptomoeda suggests we will likely see a downturn as technical indicators signal an upward sell-off.
It is likely that the disadvantage observed in recent hours will continue and push prices down to $30,000. Despite this, the crypto sphere remains optimistic about the BTC/USD currency pair next year; with analysts predicting that prices could rise to $75,000 – $100,000.
Currently the price of Bitcoin is crying out for a sharp correction as can be seen by the negative sloping RSI on the 4-hour chart. The drop from an overextended position to the RSI may be critical in the short term as last time the price of BTC reversed when the indicator was touching the 88-90 region and dropped almost 80%.
A look at the 4-hour chart shows that the BTC/USD pair has reversed, but the bulls are holding strong above $32,000. The BTC/USD currency pair will likely jump to recent highs before slowing down to retest support levels around today’s prices. In this case, the price movement of the cryptomime could form a downward head and shoulders pattern.
If the bearish pattern is completed, it could indicate a 25-30% correction in the short term.
On the negative side, bears will probably prevail if bulls can’t keep prices above 20-SMA ($31,559). A prolonged downturn in sales volume may cause prices to fall to lows of $26,000, signaling a potential end to the parabolic boom.
If prices fall to the robust support zone near the $24,000 area, $21,000 is likely to provide more comfort in the event of an overstretching handicap.
However, if a bullishness is resumed with the strong buying volume, it is likely that prices could retard the main resistance level near $34,800. Above this level buyers can reach $37,000 – $38,000.
At the time of writing, Bitcoin is trading near $31,700, just below the previous resistance level of $32,000. From a technical perspective, bulls need to keep prices above or around this price level to avoid a new test of the old support zones below $30,000.