Bitcoin to Retest $42K, but Will This Support Level Hold?

• Bitcoin’s bearish triple top hints at a price decline. 
• Schiff warns of a potential drop to $15,000-$20,000.
• Key support levels are crucial for Bitcoin’s future price action.

Bitcoin’s price action is flashing warning signs, showing similarities to a bearish triple top pattern. This pattern hints at a possible decline, especially when viewed in the context of gold. 

According to Peter Schiff, Founder of SchiffSovereign, Bitcoin is likely to test the upward trend line near $42,000, though this level might not hold. A deeper correction to the longer-term support levels, between $15,000 and $20,000, seems a more likely trend.

Resistance and Support Levels: What to Watch

Bitcoin is encountering significant resistance near the 8646.87% level. This price point marks previous highs where the cryptocurrency faced multiple rejections. Consequently, the market has shifted into a downtrend. This resistance zone is crucial for predicting whether Bitcoin can regain upward momentum or continue its descent.

On the other hand, the price of Bitcoin is now approaching a crucial support level of approximately 7802.86%. This horizontal support has withstood previous tests and may likely be instrumental in shaping Bitcoin’s short term movements. If Bitcoin is unable to hold this support level, it may experience a further drop.

Read also: Bitcoin Price Needs to Double to Boost Miner Revenue, Says PlanB

Additionally, there’s a long-term ascending support trendline extending from 2019. Should the downward trend persist, this line could serve as a major support zone, potentially around 6000%-7000% by 2025. This trendline has weathered previous corrections, suggesting it might offer significant support in the future.

Trend Analysis and Market Dynamics

The current trend indicates a bearish correction, marked by lower highs and lower lows. Bitcoin has struggled to surpass previous highs, leading to a downward trend. The area near 7800% could be a pivotal point. A rebound from this level might propel Bitcoin back towards the 8646.87% resistance. However, a break below could signal a more profound correction toward the ascending support line.

As per Coinglass data, Bitcoin’s derivatives market shows notable activity. Trading volumes have surged by 134.50%, reaching $55.50 billion. Options volume increased by 125.07% to $999.17 million. 

Conversely, open interest saw a slight decline of 3.57%, now at $30.68 billion. The options open interest rose marginally by 0.93% to $19.91 billion. Notably, Binance’s BTC/USDT long/short ratio stands at 1.7732, while OKX reports 1.54. Top traders on Binance exhibit a long/short ratio of 1.9369 in accounts and 0.9882 in positions.

At press time, Bitcoin’s live price is $58,172.17, reflecting a 24-hour decline of 2.91%. The 1-day RSI reads 46.69, indicating a neutral market stance. Meanwhile, the MACD trading above the signal line suggests a short-term bearish trend.