Bitcoin has finally broken down following reports that the Securities and Exchange Commission (SEC) has sued Binance.
It seemed inevitable that we’d eventually get a $25,000 retest, although I did think we would get one more rally to $28,000 before the selloff.
I was wrong, but it’s time to put that aside because we have a new BTC range to trade.
Given today’s breakdown, the $26,500 level flips to resistance.
The key support area for this week is $25,200, which served as resistance for Bitcoin between August and February.
That will be a significant test for the market, and I don’t expect it to go down without a fight.
With that in mind, I’m anticipating some ranging price action between $25,200 and $26,500.
However, instead of simply longing BTC at $25,200, a better approach is to wait for a confirmed deviation below the area.
And it just so happens that we have channel support near $24,300 that could serve as a technical catalyst.
So here’s how I’ll play an immediate retest of $24,300 channel support:
The reclaim of $25,200 is where you’d want to long if you’re trading the range.
Alternatively, an immediate retest of $26,500 (chart below) could offer a favorable short opportunity with targets of $25,200 and $24,000.
It all depends on which path Bitcoin follows.
Alternatively, a reclaim of $26,500 would confirm a deviation and expose $27,500.
Get Lifetime Access to Our Trading Group to watch today’s members-only video on Bitcoin, get direct access to Justin Bennett and over 1,000 traders, exclusive forex and crypto trade setups, and see Justin’s trades in real-time!