Bitcoin (BTC) experienced a setback after failing to break out of its long-standing trading range despite reaching new yearly highs.
The cryptocurrency faced rejection at $31,500 and subsequently dropped below the $30,000 level. Traders are now adopting a risk-off approach in the short term, with technical indicators suggesting a potential period of rangebound price action.
However, there are indications of solid buyer interest at the overnight lows near $29,700, providing some support for Bitcoin’s price trajectory.
Traders are closely monitoring the relative strength index (RSI) on 4-hour timeframes, which has reset after Bitcoin’s decline towards the lower end of the range.
The lack of significant volatility over the weekend is expected, leading to more rangebound price action. Despite aggressive short selling following the $31,500 rejection, there appears to be solid buyer interest near the overnight lows of around $29,700.
While short-term retracements and sideways movement below resistance pose challenges, the overall bullish narrative remains intact.
Market participants, such as TraderKoz, emphasize the importance of considering the bigger picture and not losing focus.
They highlight the weekly chart, which suggests a bullish outlook for Bitcoin despite the possibility of pullbacks to levels such as $28,000 or $29,000. Traders are advised to be prepared to bid on such dips.
It is worth noting that waiting for an ideal pullback zone may result in missing out on potential opportunities. Previous analysis acknowledges that a deeper comedown challenging Bitcoin’s uptrend may not materialize.
Traders are urged to remain flexible and adapt their strategies based on market conditions, rather than relying solely on predetermined pullback levels.
