Bitcoin has been able to maintain its upwards momentum that it incurred a few days ago and BTC has now pushed up to $4,000. This upwards price move has been fueled by a surge in trading volume, but one analyst is now importantly noting that trading volume over high-time-frames must improve in order for an upwards price move to be sustained long-term.
Other analysts are also importantly noting that Bitcoin is now beginning to establish $4,000 as a level of resistance, which could prove to be a critical level that must be broken through in order for further gains to ensue.
Bitcoin (BTC) Continues Climbing, But Faces Resistance at $4,000
At the time of writing, Bitcoin is trading up nearly 3% at its current price of $3,985. Bitcoin began its recent push on February 17th, when its price dipped to $3,600 before surging to its current price levels.
Following this move, BTC traded sideways for less than a day before continuing to climb until it hit approximately $4,000, which has proven to be a level of resistance.
Lucid TA, a popular cryptocurrency analyst, spoke about this resistance level in a recent tweet, noting that he believes BTC will rest around its current price levels before continuing climb.
“$BTC is hitting the first significant resistance since the breakout, I think we’re likely to rest a little while here.”
Hsaka, another popular analyst, shared a similar sentiment in a recent tweet, telling his followers that he will begin looking to short Bitcoin when its price reaches the low-$4,000 region.
“$BTC Not looking to short until the demarcated zone. Meanwhile, here’s an alternate way to find confluence with your S/R levels. Divide up a range/swing into quarters.”
Because Bitcoin and the entire cryptocurrency markets are fresh off of a large price surge, it is likely that they will range sideways, or drop slightly, before garnering enough buying pressure to propel them higher.
Analyst: Bitcoin Trading Volume Must Increase in Order for Price to Surge Higher
One notable feature of this latest BTC price surge is that its 24-hour trading volume has climbed significantly, surging from weekly lows of under $6 billion to its current levels of roughly $10.5 billion.
Josh Rager – another popular analyst – explained that over a longer time frame, Bitcoin’s trading volume is down significantly and an inability to continue increasing may lead BTC’s price back down to its support levels in the low-$3,000 region.
“$BTC Chart: Bitcoin currently at resistance level with a break and close above $4100 is bullish… But… Volume continues to decrease on high time frames: the decreasing volume w/ rising price = bearish. If the volume doesn’t pick up, I foresee $BTC price dropping back to support,” he explained.
As Bitcoin begins picking up steam and recovering much of its recent losses, analysts will likely gain further insight into whether or not this is a sustained movement, or if a drop back to its strong support level of $3,000 is inevitable.
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