The 56 000 dollars level
I saw this level as one of the strongest supports even before we have started the decline. Why? Because it tells us how “strong” Bitcoin is, since the last low wick of a daily close was at this level. If we close below this level, that would immediately few signals. First one would be showing that the market is now not strong enough to go up. Second would be showing us that bears are so powerful that they can break this level.
The whole dynamics of the short term growth potential would change, however, this would not probably constitute the beginning of the bear market. We can breach this level during the day, but the daily close has to stay above this price level.
Short term outlook
Looking at the 4H chart, we can see that we have decent resistance above. It is the MA21 and the previous low, which are forming a resistance between 58 408 – 59 281 dollar levels. I personally believe that for the few upcoming days Bitcoin can have a problem with these levels. Yet, the most important thing anyways is to close above 56 000 dollars, which can boost the price increase in the coming days.
What is my personal view?
Since we are in the cryptocurrency world and the 56 000 dollars mark seems to be the most crucial level now, it is obvious that we will be trading below this level for some time. This would only be to trigger the stop losses and maybe a liquidity cascade a bit. Yet, this is pretty common. Still, it is important not to close below this level. What I liked was the fact that during the last night the altcoins did not bleed out more than Bitcoin, which can be a signal of a relative overall strength in the market. But if I look at the altcoins separately, most of them are at decisive levels as well, but unless they break them down, it is all still bullish. However, if some Top coins close below the important levels, it can end up pretty bad.