Bitcoin Price Forecast – Bitcoin Drops Back Into Consolidation

Bitcoin Technical Analysis

Bitcoin has sold off rather drastically on Tuesday, but at the end of the day, it probably doesn’t change much. Ultimately, this is a market that had gotten way too ahead of itself with all the money flowing into the ETF. And therefore, I think we’re in a pattern that looks a whole lot like it’s going to be consolidation. With that being the case you are in an uptrend.

So, you do have to always be looking out for buying opportunities. You definitely don’t want to start shorting Bitcoin anytime soon. After all, it is a market that is built on momentum more than anything else. Now that the inflows into the ETF have abated, because quite frankly, all the hot money’s jumped in there, we can now start to work off the froth.

The $60,000 level underneath should end up being a reasonable support level with the 50-day EMA sitting right there as well. It’s already proven itself a couple of times, so we’ll have to wait and see whether or not that is indeed the case again, but there’s nothing on this chart to suggest that it won’t be. On the upside, the $75,000 level is the next major level above the recent swing high, so I’m suspecting at this point in time we’ll probably consolidate between those two levels.

If we do break down below the $60,000 level, it’s very possible we could drop all the way down to $52,000, which would be another area that previously had been important. It’s going to be interesting to see how this plays out because the market will have changed forever. Now that Wall Street has its hands firmly on Bitcoin, it’s likely to behave more like a Wall Street asset.

This massive surge won’t be replicated anytime soon unless of course it’s a panic because it was a lot of money that was forced into the ETF. So having said that, I think we have some work to do grinding off some of the excess froth. So this consolidation makes perfect sense.

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