Bitcoin has entered into a new month, but its price has not been doing as well as expected. The end of July had indeed come with good tidings as the bitcoin price had broken above $24,000. However, maintaining this point has been a harder task. As the market welcomes the new month of August, bitcoin has not had the best of starts to the new month, entering it with a red daily close.
Bitcoin Going For The Win?
Bitcoin’s recovery over the last week has been propelled forward by different things. The most recent one was the announcement that the United States was now in a recession after recording two consecutive negative GDP growth, causing individuals to find where to park their wealth. Bitcoin naturally provided the perfect hedge for people who were looking to escape the growing inflation, triggering a massive accumulation trend.
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It had seen the price of bitcoin quickly break multiple important technical levels. The 26th and 27th had been really good days for bitcoin after the digital asset closed both days in the green. But that will quickly change in the next couple of days.
With the new month, bitcoin has now seen its 3rd consecutive daily red close. Now, this is not alarming in any way, given that the digital asset is in a bear market, but it does speak to the performance of the digital asset in the coming days.
BTC falls to mid-$23,000 | Source: BTCUSD on TradingView.com
An example is that if there is no immediate recovery, the decline that will follow will see the cryptocurrency’s price plunge more than it actually gained in its recent recovery. What this means is that a failure to hold this bullish rally could set bitcoin back to the $20,000 love.
Obviously, bitcoin has previously seen significant support at this level and continues to see mounting support at the same point, but it makes no difference if there is not enough buying pressure on the market. Also, as investors rush to take profits over the recent recovery, the selling pressure may overwhelm traders and turn their focus to shorting the market.
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The digital asset has already lost more than $2,000 over the last two days. It has also declined below its 50-day moving average once more, the same technical level that had been one of the indicators of the bear trend in previous markets.
For bitcoin to establish a bullish trend, it must break above $24,800 and hold this level. Otherwise, there is likely to be a rapid decline in price over the next couple of days.
Featured image from Forbes, chart from TradingView.com
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