Research warns that Bitcoin bulls have a long way to go to maintain their newfound support, but BTC could still fall below $20,000 if they fail.
March 5 remained close to key support as the weekly candle close rekindled fears of a breakout.
An analyst warns of a fortune of $20,000
Data from Cointelegraph Markets Pro and TradingView tracked BTC/USD as it continued to trade in a short range over the weekend.
The pair was largely unchanged from a sharp decline on March 3, boosted by a margin call amid uncertainty over Silvergate Bank.
To avoid further losses, the analyst warned that Bitcoin could easily fall much lower if nearby support levels fail to hold.
Indicators at Watch Resource Material explained that BTC price action has “lost key technical support” and $22,000 – a break from recent resistance/support (R/S) – is now all that’s left to hold.
“The local R/S flip zone is the last spot amid a retest at the trendline.” Meanwhile, trend precognition indicates a bearish trend,” the news tweeted that day.
“We’ll see if that changes with the closing of the W.”
The attached charts showed the BTC/USD trendline and order book on Binance with bid liquidity at $22,000.
Cointelegraph contributor Michael van de Pope, co-founder and CEO of trading firm Eight, warned that if $21,300 fails to hold, $20,000 may not help stop the exodus.
“#Bitcoin’s critical area is going to be the 21.3k. USD area. If you miss that, we’ll see another jump to $19.50 and altcoins will drop 15-25%,” he predicted on March 4.
Still, Van de Popp took a more optimistic view, saying the $40,000 could still come “in a few months.”
“Moral of the story: Dollar averages and balls have to be bought when you’re not feeling confident,” he advised in another post.
“very bearish mood”
Silvergate’s potential bankruptcy remains a hot topic, with research firm Sentiment questioning why the market’s reaction has been so strong.
Related: Bitcoin Price Could Retest $25,000 Without Silvergate Saga – Analysis
In a special note on the phenomenon, analysts disclosed what they described as “an unusually high level of negative commentary about the markets”.
“What’s particularly interesting is that despite Bitcoin’s weak -5% pullback three days ago #cryptocrash has been the main consistently trending hashtag on the platform,” the Twitter account continued.
“Usually you can take advantage of this level of negativity in the markets and that very bearish sentiment can make for a nice bounce to silence the critics.”