Bitcoin keeps fluttering in and out of the $40,000 price level. Keeping count of these breaks above $40K, there have now been a total of five since the year started. It is one thing to break above an important resistance level but it is another to hold above it, forming strong support. The latter has proven elusive for the digital asset, giving rise to the question of whether the cryptocurrency will actually be able to hold above it this time around.
Bitcoin has been on an idle streak since it last failed to hold above $40K. After breaking above the coveted resistance point, it once again failed to prove that it could form support. It had then declined to the $38K level. This point has always formed strong support at this level, so as expected, it had been the stopping point for the decline.
For the past week, the consolidation range for the cryptocurrency had grown tighter with the digital asset trading around the $39,000 level. It still maintained low momentum throughout the time, indicating that even if there was a recovery trend, it would not be significant in any regard.
BTC recovers above $40K again | Source: BTCUSD on TradingView.com
Bitcoin has continued to drag the market around with it though. Correlation with coins like Ethereum has remained on the high side. Uncertainty about where the digital asset goes from here has translated to trading volume. But with the opening of the midweek trading market, the cryptocurrency has picked up some momentum.
Once again, bitcoin has broken out above $40,000. This point which continues to be a hard-to-conquer level remains the most obvious obstacle for the digital asset. The $40,000 to $44,000 is the obvious culprit. Bears tend to mount their resistance at these junctions because breaking out towards $46,000 would put bitcoin on another bull trend.
As the market awaits the Fed decision, bitcoin had been rallying upwards in wait of what the outcome might be. On the other side, bitcoin’s correlation to gold has declined over the past week. It has now touched an eight-year low.
BTC’s price is still shakily holding on to $40,000 as of the time of this writing. If history is to be followed at this point, then the market may see the digital asset slide back below $40,000 by the start of the weekend.
Featured image from Forbes, chart from TradingView.com
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