Last week has been a tremendous week for Bitcoin (BTC), as the price surged from $7,500 to $9,450. However, since the peak high at $9,450, the top-ranked cryptocurrency by market capitalization has not seen a continuation, as the price is consolidating $800 lower.
Is the halving hype over, and is the market ready for a correction after a 150% rally since Black Thursday?
Crypto market daily performance. Source: Coin360
The price of Bitcoin is facing a big resistance area
BTC USD 1-day chart. Source: TradingView
The price of Bitcoin is facing its next massive resistance area, i.e. $9,100-9,500. The price of Bitcoin broke through the resistance of $7,800 last week, after which a surge towards $9,500 occurred.
As the chart is showing, a clear rejection happened at $9,500. The price of Bitcoin dropped with $1,000 towards $8,500.
Clear support levels are shown by the green zones. The first level is shown between $8,250-8,400, while the next support level is the area between $7,600 and $7,800.
On the other hand, the red resistance area is found between $9,100 and $9,500. This resistance area was established in the summer period of 2019. During the massive run from Bitcoin that year, the price has been regularly finding support in the $9,500 area.
This pivotal area is now, therefore, strong resistance. A clear breakthrough in this zone would define a continuation to $10,500 and potentially $11,500.
Traders aiming for support around $8,400, while $8,600 acts as one
BTC USDT 30-minutes chart. Source: TradingView
The smaller time frames show a clear structure of range-bound movements. The upper resistance is found at $9,000 and $9,200, while the bottom support is found between $8,400 and $8,600.
As long as the price of Bitcoin remains to be in this area, traders will be compelled to take advantage of the range-bound movements.
The $8,800 area is a crucial pivot for further upwards momentum. If the $8,400-8,600 remains to be supported, a breakthrough of the $8,800 could trigger a test of $9,100-9,200 before the much-anticipated halving event that’s now less than eight days away.
However, a break below the support of $8,400, and the next major pivot is $7,800.
Total market capitalization consolidating as well
Total market capitalization cryptocurrency 1-hour chart. Source: TradingView
The total market capitalization chart of cryptocurrencies is showing a similar structure to the Bitcoin chart.
Clear consolidation inside a range, where $250-260 billion is the resistance area, while the $230-236 billion areas are classified as support.
Losing the $230-236 billion level as support would likely result in further downwards momentum, draining the whole cryptocurrency market down toward $215 billion as the next central pivot.
A clear breakthrough of $245 billion resistance is needed for the total market capitalization to continue its recent upward momentum.
Total market capitalization cryptocurrency 1-day chart. Source: TradingView
The daily picture of the total cryptocurrency market capitalization is showing a clear picture as well.
The support around $230-236 billion is a pivotal level from the past year, as the chart shows. Holding that level for support would open the door for potential tests of the next resistance around $256 billion.
However, a break below $235 billion would likely take the whole cryptocurrency market down by 10%, as the next major level is found at $207 billion.
Bitcoin dominance still going up going into the halving of Bitcoin
BTC Dominance 1-day chart. Source: TradingView
The dominance chart is getting to a crucial level for altcoins. The 67.50% level has been providing “support” throughout the past year. However, now it’s acting as “resistance,” as far as this terminology can be used for this chart.
A breakthrough above 67.50% could add more fuel for Bitcoin, as BTC/USD is clearly gaining momentum into the halving.
However, if 67.50% is again providing resistance, a further downwards break and tests of 60% could be expected. Such a breakdown can create a substantial and strong move for all cryptocurrencies.
The bullish scenario for Bitcoin
BTC USDT 30-minute bullish scenario chart. Source: TradingView
The bullish scenario on the smaller time frames is showing a few pivotal levels. The $8,400-8,600 has to remain support, as stated previously.
After that, a breakthrough of $8,800 is needed for further upward momentum. Once that occurs, targets of $9,100-9,200 are back on the table.
However, if traders and investors want to continue the real FOMO and momentum into the halving, a break of $9,100-9,200 is needed. If the price of Bitcoin rejects this level once again, the halving rally will then likely be over.
If the $9,100-9,200 is broken to the upside, a further surge can occur with potential targets of $10,500.
The bearish scenario for Bitcoin
BTC USDT 30-minute bearish scenario chart. Source: TradingView
The bearish scenario has a few different possibilities. It’s basically coming down to two things, with the first being the support at $8,400-8,600. Losing that level, and it’s likely to expect further downwards momentum towards $7,800.
However, the next pivotal thing to look for in the charts would be the construction of a lower high on the chart. Once the price of Bitcoin breaks the $8,800 area and can’t clear above $9,000, a renewed lower high will appear on the chart.
Such momentum could create a potential descending triangle and a likely breakdown later below $8,400. The next support area will also be $7,800.