Bitcoin Climbs Above $40,000 But Struggles To Stay Above That Level

Bitcoin prices have experienced some noticeable volatility today, repeatedly moving past $40,000 but failing to stay above that level.

The world’s most prominent digital currency first surpassed $40,000 today around 11 a.m. EDT, CoinDesk data shows.

The cryptocurrency faced strong resistance after rising above that level, falling back below $40,000 in less than an hour, additional CoinDesk figures show.

Over the next several hours, the digital asset continued to trade close to the aforementioned price level, repeatedly surpassing it and then declining below $40,000.

At the time of this writing, bitcoin was trading close to $39,800.00.

[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]

Following this latest price action, several analysts highlighted key matters that investors should watch, including market developments and important levels of support and resistance.

‘Strong Resistance’ Near $40,000

The digital currency’s recent price movements “pointed to strong resistance” in the range between $40,000 and $41,500, said John Iadeluca, founder & CEO of multi-strategy fund Banz Capital.

He noted that there has been particularly heavy selling pressure “at the $40,000-$40,500 price levels.”

Should the digital currency move lower, “traders should watch for key support levels at $38,000 and $38,500, which have both been price levels that have shown foundational support for Bitcoin more times than once in its recent past,” said Iadeluca.

Brett Sifling, an investment advisor for Gerber Kawasaki Wealth & Investment Management, also chimed in.

“$40,000 is pointing to a resistance around that price during this continued downtrend,” he stated, before offering further detail.

“I’d also say that we’d see an even stronger resistance around the $45,000 and $50,000 levels, which were the tops in February, March, and April this year,” said Sifling.

“As for support levels, I’d like us to hold the $30,000 range,” he stated. “A break of that $30,000 level would signal to me that sellers are still in control and there could possibly be downside all the way down to $20,000.”

Julius de Kempenaer, senior technical analyst at StockCharts.com, provided technical analysis, identifying some slightly different levels.

He stated that bitcoin’s recent price action “certainly” points to strong resistance near the $40,000 level.

“After that the next stop seems to be around 43k,” said de Kempenaer.

“On the downside, levels are a bit less pronounced,” he stated, first mentioning “the area between 37.5k-38.5k.”

Next, the analyst identified “intermediate support near 35k” and then “very solid and important” support close to $30,000.

Dollar Strength

William Noble, the chief technical analyst of research platform Token Metrics, offered some technical analysis, but he also emphasized how the recent appreciation in the U.S. dollar relative to other fiat currencies has impacted bitcoin, and how it could affect the cryptocurrency going forward.

The digital currency is “benefitting from a sharp drop in fiat currencies like the Yen, the Euro, and Yuan,” he noted.

“BTC may make a run at resistance near 41k and then fail,” said Noble.

“BTC – and all of crypto – may be hurt by the unstoppable rally in the U.S. Dollar Index (DXY). If BTC fails at 41k, any real support is well below the market at either 37k or 35k.”

Options Expiry

Multiple analysts spoke to the monthly bitcoin options contracts that are scheduled to expire tomorrow, emphasizing how they could impact the cryptocurrency’s price.

Armando Aguilar, Head of Alternative Strategies for financial services firm Ledn, commented on this situation.

“Over $2B worth of options will expire tomorrow,” he noted.

“The max pain point for the April expirations sits at a concentrated range of $34k-$38k as per coinglass analytics.”

“Market participants could look to push prices down if BTC prices hovers in the high end of the range,” said Aguilar.

Disclosure: I own some bitcoin, bitcoin cash, litecoin, ether, EOS and sol.