- Bitcoin has continued to struggle to break and despite a slight rally over the weekend, it was unable to sustain the momentum and is now trading at $34,000.
- This week promises to bring with it a lot of market-defining moments, including an expected hash rate drop and possible testing of critical resistance and support levels.
After a weekend that brought hope that Bitcoin was staging a comeback, the top cryptocurrency has started the week with yet another drop. BTC has lost over 3 percent in the past 24 hours to trade at $34,350 as per our data. In the week ahead, a number of moments could prove pivotal to its future, one of which is whether it can breach its 50-day simple moving average. Analysts also predict there could be another hash rate drop, and this could take its toll on the top crypto.
On Saturday, Bitcoin was trading as low as $33,235 during the early hours. However, it managed to stage a rally that took it all the way to $35,907, its highest level since Tuesday. However, it has started the week by setting an intra-day low at $34,089.
And while the weekend rally was encouraging, it had one peculiarity – it happened at a time when the trading volume was in a decline. The volume over the weekend was one of the lowest in the past month as the chart from Bitcoinity below shows.
Data courtesy of Bitccoinity.
This, according to chartists, is the reason the rally was unsustainable and explains the drop today. The volume has yet to recover and in the past day, it’s down by 4.4 percent to stand at $24.9 billion.
On-chain analysts at CryptoQuant stated in a quicktake:
BOTH Inflow and outflow are drying out with the trading volume in the market. Seems like the whales are staying low without much action. Push to either side of the market would have a high possibility of triggering a relatively big reaction to the price.
Bitcoin support and resistance levels
Over the weekend, Bitcoin rallied to just below $36,000. According to one analyst, had BTC been able to shoot above this level, it would have gained enough momentum to sustain the gains. Known as Rekt Capital, the analyst noted:
Once BTC is able to clear $36000… Next major resistance will be the ~$38000 area.
Once #BTC is able to clear $36000…
Next major resistance will be the ~$38000 area
Not only is this the Range High of the macro consolidation range #Bitcoin is in now…
But the two $BTC Death Cross EMAs (50 blue & 200 black) will likely act as confluent resistance there too pic.twitter.com/8KJLQgZl0T
— Rekt Capital (@rektcapital) July 4, 2021
At its current price, the next important resistance level to look out for is $34,570, which it has been flirting with all day today. This is its 20-day simple moving average. After this, the $35,600 will be critical as well – this has been the flagship crypto’s weekly resistance.
Once it’s able to clear this, breaching the 50-day simple moving average at $36,375 will set up BTC for a break out that could take it past $40,000 for the first time since June 16th.
On the flipside, should BTC breach $34,000, the next support is at $32,700, which is the support level it established in the early days of this month.
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