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Bitcoin, Ethereum Could Be Setting Up for Breakouts This Week

Published 06/05/2023, 10:41 AM
Updated 09/02/2020, 02:05 AM
  • Both Bitcoin and Ethereum tested their resistances last week
  • However, bulls failed to gather necessary momentum for a breakout
  • Both cryptos should look for a new test of the resistances this week

Bitcoin has maintained a narrow trading range between $26,300 and $27,300 for about a month. The declining trading volume suggests a consolidation phase for the cryptocurrency.

However, price movements breaching the range have lacked the necessary momentum to spark a significant trend reversal.

BTC/USD Price Chart

BTC recently encountered resistance at the $28,000 level. Currently, the $26,500 level has acted as a reliable support. Additionally, the $26,300 level, which has been tested twice within the past month, is a crucial support level.

A close below $26,500 this week could result in the cryptocurrency breaking its 2023 uptrend. This breach could be a trend reversal for BTC, and a new downtrend targeting support levels at $25,300, $24,100, and $22,350, could ensue.

The cryptocurrency has to stay above $27,100 to avoid downside risks. Such a breakthrough would indicate an increase in buyer volume, providing BTC with the strength to surpass the $28,000 resistance level.

In the event of a potential recovery, BTC may encounter intermediate resistance around $29,000, following the $28,000 mark. Subsequently, close attention will be paid to the main resistance zone ranging from $29,600 to $30,500.

This zone aligns with the midline of the ascending channel movement observed in 2023 and will be a critical price range to monitor for the continuation of the uptrend.

On the daily chart, moving averages support the $26,500 - $27,100 band as an important support zone. BTC price is currently between the short-term EMA values.

In this case, the EMA value positioned at $26,500 confirms that this level is a critical support point. At the same time, the coincidence of the 89 EMA with the bottom line of the ascending channel increases the probability of a breakout.

To summarize, Bitcoin's net close of the day below $26,500 or a drop in volume technically indicates that the price could trigger a rapid decline.

Ethereum

Ethereum enters the week following the ascending trend line. However, it faces challenges in breaking the short-term downtrend line that started in mid-April.

ETH/USD Günlük Grafik

The ETH daily chart currently shows a triangle formation, suggesting that the price may soon experience increased volatility. If ETH closes below $1,850, it could indicate a downward breakout from the triangle, leading to a potential decline toward $1,660.

On the other hand, if ETH opens and closes above $1,950, it would confirm an upside breakout and may set a target of $2,100, which is a key level.

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Disclaimer: This article was written for informational purposes only; it does not constitute a solicitation, offer, advice, counsel, or recommendation to invest, nor is it intended to encourage the purchase of assets in any way.

Latest comments

it good
Yeah, maybe or maybe not.
people here will soon eat their words... lol
everyone about to eat their words here in the comment section.
Who gave you permission to post? Get out of here with you analisis
no one forces you to read . . .
Yeah, poised for breakdown this week
Wow this didn't age well. Can you please take it down before people start listening to you?
the bitcoin chart looks pitiful, a break back to support at 19000 is possible...
It's game over for bitcoin and crypto. 32k and above is all the last chance to cash out
I think you misspelled "breakdown."
Bro these analysts.... smh
Break down you mean lol
The Jim Cramer of crypto
This is what you would call bad timing.
you're a criminal, you know. pump while people lose billions
Right on time
yup
The dollar is too strong right now for crypto.
breakout? more like breakdown.
LOL nice break out today to 25800
You are quite funny 🤣
thank you for sharing the article 💯
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