Bitcoin is consolidating today after testing the $25,200 resistance level on Tuesday.
But despite some calls for a top, BTC is holding up relatively well.
In fact, it’s still above Tuesday’s low, and the monthly open at $23,130.
That $23,130 monthly open is the level to watch for Bitcoin as it will serve as a “hinge” for bullish or bearish movement.
As long as Bitcoin is above that level on the higher time frames, shorts are unfavorable, and we could get a move back to $26,000 or higher.
Alternatively, a sustained break below $23,130 on the higher time frames would tilt the chart more bearish toward lower levels like $21,150.
I still think we see Bitcoin test the $18,400 level and potentially lower, but maybe not before one last push above $25,200.
Even Tuesday’s long upper wick is a reason to suspect higher before lower.
BTC has a habit of filling long wicks like Tuesdays, so a move back to $26,000 wouldn’t surprise me.
But traders have to be careful if we start to see $27,000 come into play, as $27,400 is the top of the 2023 channel.
Price has been moving within this ascending channel since January.
For now, there isn’t much to do with Bitcoin trading sideways.
But a reclaim of $25,200 would open up $26,000 and potentially $27,400, while a sustained break below $23,130 would turn BTC bearish toward $21,500 and $20,000.
Regardless, getting overly bearish while the price is above $23,130 is ill-advised.