The Bitcoin price fell to $39,500 in Tuesday’s trading session after bears broke below the bullish channel depicted on the daily Chart.
BTCUSD Technical Analysis – January-23-2024
The current price coincides with the 38.2% Fibonacci resistance level, also positioned just below the Ichimoku Cloud. The technical indicators support the bearish bias. The RSI indicator hovers below the midline, and the Awesome Oscillator bars are red and positioned below the signal line.
Divergence in the 4-Hour Chart
Zooming into the BTCUSD 4-hour chart provides a better understanding of today’s market behavior.
The level of $39,465, aligning with the 38.2% Fibonacci level, acts as support that might prevent further decline in Bitcoin’s price. The RSI indicator signals an oversold market. That said, the Awesome Oscillator shows divergence in its bars.
Despite the robust bearish bias in the trend, the pair might experience weak uptick momentum if the 38.2% Fibonacci support holds. In this scenario, the price might rise to test the upper band of the bearish flag at the $41,000 mark. This resistance level coincides with the Ichimoku Cloud on the 4-hour BTCUSD chart. The upper band of the mentioned channel offers a favorable execution price for retail traders to join the bearish market.
Final Words
Please note that going short is not recommended in oversold market conditions. Traders should exercise patience and wait for a pullback before entering the primary trend. This approach helps CFD traders manage the risk/reward of their trades and provides extra protection against trading risks.
J.J Edwards is a finance expert with 15+ years in forex, hedge funds, trading systems, and market analysis.
