There is a path forward for Bitcoin price to see a much stronger correction than the one seen yesterday

By Selena On Aug 29, 2020

Bitcoin price is currently consolidating around its local highs following the swift overnight rebound it faced. This rebound came about following a day of turbulence, which sent BTC surging as high as $11,600 before it saw a swift rejection that led it to plunge to lows of $11,150. At press time, Bitcoin is trading up just over 1% at its current price of $11.514. This is around the price at which it has been trading throughout the past few hours.

BTC/USD 4-hour chart | Source: TradingView

This struck a blow to the cryptocurrency’s technical strength. Still, buyers were able to post an ardent defense of the lower-$11,000 regions that ultimately allowed it to climb significantly higher. That being said, another rejection at $11,700 could spark a deeper correction that sends BTC as low as $10,000 before it can continue ascending.

Bitcoin price is in the process of stabilizing following the swift rebound it incurred overnight

Yesterday morning, news of the Fed’s decision to allow inflation to run hot for the coming months and years sent the prices of hard assets – like Bitcoin – flying higher. BTC swiftly reached highs of $11,600 before it lost its momentum and plunged to lows of $11,150.

The visit to this level sparked a slow grind higher that eventually allowed the cryptocurrency to climb back to $11,500. From this point on, it has been trading sideways, struggling to maintain its momentum.

In the near-term, analysts are watching for a Bitcoin movement to $11,700. Trader Teddy is specifically noting that a rejection at this resistance level could spark a correction that is deeper than that seen yesterday.

He stated:

“No interest to short this market, but this is how I would envision a small potential correction. 1) Rejection from 11,700 2) Slow bleed and retest of 10,000 resistance as support 3) Successful retest and uptrend resumed…”

No interest to short this market, but this is how I would envision a small potential correction.

1) Rejection from 11,700

2) Slow bleed and retest of 10,000 resistance as support

3) Successful retest and uptrend resumed

4) 250k$BTC pic.twitter.com/SBkK7TwURO

— Teddy (@TeddyCleps) August 28, 2020

Unless Bitcoin’s momentum stalls and it consolidates here, there’s a strong likelihood that yesterday’s volatility is just the start of a new round of turbulence.

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