Bitcoin is fast approaching a long-watched overhead resistance level formed in the time following its recent rejection at its $19,500 all-time highs.
The selling pressure here proved to be quite significant and caused the cryptocurrency to see a strong decline that led it to lows of $16,400.
This movement was perpetuated by various factors, including fear surrounding a potential wave of regulations due to comments from U.S. Treasury Secretary Steven Mnuchin.
Where the market trends in the mid-term hinges almost entirely on Bitcoin, as the recent $19,000 rejection halted the recent signs of life seen amongst altcoins and caused the aggregated market to decline significantly.
There’s a strong possibility that the ongoing rebound will extend further, as bulls seem keen on posting a “V-shaped” recovery as they erase the recent losses.
As for what traders expect to happen next, one stated that he is taking some money off the table as the crypto navigates up towards its overhead resistance level in the lower-to-mid $18,000 region.
He notes that a break above $18,400 could be enough to invalidate any signs of weakness plaguing its price.
Bitcoin Breaks $18,000 as Rebound Continues
At the time of writing, Bitcoin is trading up just under 2% at its current price of $18,090. This marks a notable climb from its recent lows of $16,400 set at the bottom of the recent market-wide meltdown.
This plunge came about close on the heels of the cryptocurrency’s visit to the mid-$19,000 region. Significant selling pressure existed within this region.
If it can gain a strong foothold within the mid-$18,000 region, it may see significantly further upside in the near-term.
BTC May Struggle to Break Its Overhead Resistance, Claims Trader
One trader stated that Bitcoin might not break through the resistance that is laced throughout the lower-$18,000 region.
He adds that a firm break above $18,400 could allow for the cryptocurrency to continue its ongoing rebound.
“Closed half of long at $18,080~ Not looking to be too overexposed into resistance coming into the weekly m/monthly closes. Lots of buying opportunities if we do break $18.4~ Not a lot of selling opportunities if we don’t.”
As Bitcoin’s weekly candle close fast approaches, how it trades in the coming few hours should provide serious insights into its outlook for the rest of 2020.
A close above $18,000 will significantly bolster its outlook and open the gates for bulls to take control of its price action throughout the week ahead.
Featured image from Unsplash. Charts from TradingView.