Last Friday, Bitcoin saw a pause in selling after shedding a 12% loss in two weeks. It has been in a retracement mode for three days and is likely to resume selling as the price reaches a key breakdown level.

Bitcoin’s mid-term outlook is still under the correctional phase following a new sell order from the $65,000 range last month. The mid-term bearish sentiment is back but the price is undergoing a retracement.

The current price retracement is aimed at the $55,000 – $56,000 zone that flipped last Friday. This key zone may hold as resistance capable of activating another drop to or even below last month’s support.

Such bearish scenarios could lead to a huge drop to the lower boundary of the wedge forming since March. This boundary area is where a lot of buyers are waiting to initiate a major entry into the market. Considering the price range on the daily chart, more sell-offs should be expected.

However, if Bitcoin defies the odds by climbing back above last month’s high, sentiment would turn bullish as that could trigger a change in the market character from a short-term perspective. But from the look of things, the bears are much more likely to sustain pressure for a while.

The recently broken $56,078 support (now resistance) is the main target for a test in the ongoing retracement. There are many minor resistance above this level but the major resistance to watch next is $61,190, followed by last’s high of $65,065.

Losing grip above the $52,550 support could roll the market back to its six-month low of $49,000 before dipping heavily to $45,000, where the wedge’s lower boundary lies.

Key Resistance Levels: $56,078, $61,190, $65,065

Key Support Levels: $52,550, $49,000, $45,000

Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any services.

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Image Source: fellowneko/123RF // Image Effects by Colorcinch

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