- Bitcoin has been caught in a firm consolidation phase but is now showing some signs of weakness
- The cryptocurrency is currently pushing down towards its key support within the mid-$11,000 region as its bulls falter
- There is currently a massive trading range that analysts are closely watching
- Which of the range boundaries that the crypto breaks above – or below – first will likely offer significant insight into its near-term trend
- Some respected traders are also gearing up to short the upper end of this trading range
- This is a sign that they expect it to be insurmountable in the near-term
Bitcoin and the aggregated cryptocurrency market has been struggling to maintain the momentum seen throughout the past several weeks.
For BTC, its multi-week rally first began slowing last week when it saw a sharp rise to $12,000 before facing a rejection that sent it reeling down to $11,000.
This decline struck a serious blow to its near-term outlook and sparked the consolidation phase that it is still caught in today.
Analysts are now noting that this has led BTC to establish a wide trading range between $11,200 and $12,200.
One trader is noting that which of these levels breaks first will offer significant insight into the crypto’s macro trend.
Bitcoin Struggles to Rally Higher as Analysts Flip Short
At the time of writing, Bitcoin is trading down just over 2% at its current price of $11,650.
This is around the price at which it has been trading throughout the past couple of weeks – struggling to garner any clear momentum as it hovers within mid-to-upper $11,000 region.
It is important to note that BTC is currently trading at a level that has been established as support on multiple occasions throughout the past week.
A dip below here could lead to a deeper pullback.
If Bitcoin can rally higher and buck this downtrend, one analyst is noting that he is looking to short the lower-$12,000 region with a target of around $10,000.
“If 12.2k – 12.3k comes – Might just be the first short I take this month as a swing play down to 10s,” he said.
Here’s the Macro Trading Range that Will Determine BTC’s Future
While speaking about where Bitcoin may trend next, one prominent trader explained that he is watching to see how it reacts to the upper and lower boundaries of a newly formed range.
This range is between $11,200 and $12,200.
“Bitcoin is still trading in a range since the start of August, a break of either 11.2k or 12.2k will be a fairly obviously breakout long or short with defined risk. Generally dislike taking positions in the middle of the range since wicks are so frequent now.”
Image Courtesy of Flood. Chart via TradingView.
Because BTC has already faced a rejection at the upper boundary of this trading range, it may soon test $11,200.
Featured image from Unsplash. Charts from TradingView.