Bitcoin has moved sideways in the days since its recent collapse, from a high of $ 8,000 to a low of $ 3,600. The recovery that followed in the aftermath of this intense sell-off led BTC to the low $ 5,000 area, where it has been trading ever since.
It now appears that the recent sell-off has caused the key currency to drop below the lower bound of a critical support region, and re-examining that level has led to severe rejection.
This seems to indicate that BTC will experience a further downward trend in the coming days and weeks.
Bitcoin begins intense sideways trading
At the time of writing, Bitcoin is trading at $ 5,350, a slight drop from the daily highs of $ 5,600 set yesterday.
It is important that the rejection at this level further confirms that this is the upper limit of the newly created trading range and that the cryptocurrency is strongly supported at around $ 5,000.
In the short term, it appears that both bulls and bears have reached a dead end. It is very likely that the development of the coming days will depend on how the US stock market trades when it reopens tomorrow, which could be positive for Bitcoin if the bulls are able to take the massive momentum that the stock market has seen in the past Friday suffered to extend.
Teddy, a popular crypto analyst on Twitter, recently tweeted that he believes the recent rejection at an earlier key support level could pose problems for the coming year.