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Bitcoin Price Analysis: BTC spikes to $34,000, swift reversal to follow?

TL;DR Breakdown

  • BTC continued to rally overnight.
  • Next resistance at $34,000 reached today.
  • Bitcoin is set to reverse.

Bitcoin price analysis indicates bearish momentum to follow over the next 24 hours as another spike higher was seen overnight, and the next major resistance around $34,000 was reached. Therefore, we expect BTC/USD to decline over the next few days and attempt to set a higher low.

Cryptocurrency heat map. Source: Coin360

The overall crypto market traded with a strong bullish momentum over the past 24 hours. Bitcoin is up by 4.5 percent, while Ethereum is up by 5 percent. Polkadot (DOT) is among the best performers, with a gain of over 8.3 percent.

Bitcoin price movement in the last 24 hours: Bitcoin rallied to $34,000

BTC/USD traded in a range of $32,057.89 – $33,953.50, indicating mild volatility over the last 24 hours. Trading volume has increased by 19.21 percent and totals $23.4 billion. Meanwhile, the total market cap stands at around $635.27 billion, resulting in a market dominance of 45.83 percent.

BTC/USD 4-hour chart: BTC ready to reverse?

On the 4-hour chart, we can see the Bitcoin price action finding resistance around the $34,000 mark and preparing to retrace some of the gains.

BTC/USD 4-hour chart. Source: TradingView

The overall Bitcoin price structure still indicates bearish momentum as no clear high thigh was established over the past week. From the previous major swing high of around $36,500, BTC/USD declined by more than 20 percent until support was found around $29,500, where the market saw a sharp rejection candle at the end of June.

However, after retesting the $29,500 support on the 20th of July, BTC/USD started to rapidly rally higher. Yesterday, the several-week descending trendline of resistance was tested again, with a consolidation forming around $32,500 price area for more than 24 hours.

Overnight, Bitcoin suddenly saw a quick spike higher, breaking through the descending trendline, and moving past the local high of $33,000. What followed was a further rally to the next resistance at $34,000. 

Therefore, BTC/USD price action structure has seen the first sign of a serious trend reversal. First, we will likely see another retracement lower over the next few days. If Bitcoin price can establish a clear higher low, we can expect another attempt to move higher over the next week, which could result in a much more substantial reversal for the several-month bearish price action.

Bitcoin Price Analysis: Conclusion

Bitcoin price analysis indicates bearish momentum to follow over the next 24 hours as a rapid spike higher was seen overnight to the $34,000 mark. Therefore, BTC/USD has exhausted its bullish momentum and likely will start declining to establish a higher low from which to push towards further highs over the next weeks. 

While waiting for Bitcoin to retrace, read our guides on Bitcoin fees, what can you do with Bitcoin, as well as what is DeFi.

Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.

This post was last modified on July 24, 2021 4:09 pm

Lapin

Lapin is an experienced freelance Crypto and Financial market writer and analyst. He has been trading for several years and holds a bachelor’s degree in Finance.

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