Bitcoin (BTC) returned closer to $40,000 on Thursday as $44,000 resistance proved too much for bulls to overcome.
Buying another dip
Data from Cointelegraph Markets Pro and TradingView showed BTC/USD shedding around 4% in 24 hours Friday.
The pair had topped $44,450 on Bitstamp before the retracement kicked in, this seeing local lows of $41,780.
While disappointing for those hoping that the worst of the pullback was over, analysts appeared unsurprised by the move, which they said could resolve via a fresh test of $40,000 support.
Pretty much the path for #Bitcoin. pic.twitter.com/VY0BkTXYOM
— Michaël van de Poppe (@CryptoMichNL) January 14, 2022
Popular trader Pentoshi also appeared to get his wish, BTC “sweeping” lows below $42,000 in what he had previously identified as a prime opportunity for entry. $46,000, he added, could be next.
Looming large, however, was another “death cross” chart construction on BTC/USD, a classic signal warning of bearish conditions.
As Cointelegraph previously reported, a death cross occurs when the declining 50-day moving average crosses under the 200-day moving average. The feature is somewhat rare but has not always resulted in bearish behavior thereafter.
Upside conclusion still on the cards
Looking ahead, analysts at trading suite Decentrader remained bullish on mid-term price action, acknowledging that another dip into the $30,000-$40,000 range may yet occur.
Related: Top or bottom? Traders at odds over whether Bitcoin will keep rising
The two-month downtrend from early December was ripe for disruption, they argued in a market update issued Friday, and the upside was “likely” over a cascade lower.
“It is our view that we may need to see some further ranging between $44,000 and potentially $38,000 before an eventual breakout. This ranging is likely to cause more pain and misery for any traders who try to impatiently front-run major moves before they are ready,” the update summarized.
Encouraging, Decentrader added, was funding rates slowly becoming more consistently negative as sentiment finally flipped to expecting further downside — healthy conditions for a squeeze to the upside.
“Given the current fundamentals of Bitcoin and the size and consistency of the downtrend over the past 2 months, we do believe that a move out of the range to the upside is the most probable outcome eventually.”