Bitcoin (BTC) has fallen below the $ 46,300 support area but is still trading near the long-term support of $ 44,300.
Stop the support
By the dawn of January 6th, Bitcoin dropped significantly to as low as $ 42,500. That move caused the price to break below the $ 46,300 horizontal support area that had previously held for 32 days.
This is an extremely bearish development.
The price is currently nearing the December 4th low of $ 42,000.
Bitcoin / USDT daily chart | Source: TradingView
Continue to decrease
A closer look at the trend shows that while the volume is high (red icon), it is well below the decline seen on December 4th.
Additionally, BTC appears to be moving along a descending support line. So far the price has confirmed this line four times (green symbol), most recently on January 6th.
As long as the price is trading above this line, the likelihood of a rally and a reversal remains high.
When this happens the $ 46,300 area is expected to act as resistance.
BTC / USDT 6-hour chart | Source: TradingView
Long term movement
The daily chart shows that BTC is trading slightly below the USD 44,300 support created by the support of the Fib retracement at 0.618.
In order for the long-term upward trend to continue, BTC must not close below this level.
In addition, the bullish divergence in both the MACD and RSI has not yet been weakened.
Hence, the likelihood of a reversal remains high until both indicators hit lower lows and invalidate this divergence.
BTC / USDT daily chart | Source: TradingView
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Disclaimer: This article is for informational purposes only, not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.