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Declining volume and resistance at $19,500 are pinning Bitcoin price into a tightening range.
Today was a relatively uneventful day for Bitcoin (BTC) as the price continues to consolidate into a tighter range.Â
As mentioned by Cointelegraph contributor Rakesh Upadhyay, Bitcoin price spent the weekend consolidating within a bull pennant and the breakout to $19,418 was quickly stamped out by overhead resistance.
After retouching the pennant trendline, the price gave way, falling below the 20-MA on the four-hour time frame and briefly losing the $19,000 mark.
Crypto market daily price chart. Source: Coin360
Generally, most traders seem to agree that after a raging 93% rally from $10,300 to $19,888, a period of consolidation is necessary. Cointelegraph analyst Michaël van de Poppe said:
âOn the higher timeframe, Bitcoin is still acting as it was last week. We are still acting in the all-time high resistance zone. I still have my eyes on $16K, which we bounced from, and $14K as these areas still could be retested as support. Holding $19K is important and if we have a daily close below $18.9K I think weâll fall through.â
On the daily and four-hour timeframe, traders will note that the price is still notching lower highs and higher lows, a sign that the price range is beginning to narrow.
BTC/USDT 4-hour chart. Source: TradingView
Currently, the price is still holding within the pennant trendline as support, but a breakthrough in the structure will require a high volume move as there is persistent overhead resistance at $19,500.
As mentioned in previous analysis, a drop below the $18,800 level will see BTC search for support at $17,900, and below that the $16,000 to $15,750 range.
For the short term, risk-averse traders are likely to keep a close eye on the four-hour chart to see if the price can again find support above the 20-MA in order to burst through the pennant. It is important to note that this move will require significant volume to avoid rejection in the $19,400â$19,500 resistance zone.
Bitcoin daily price chart. Source: Coin360
Typically, altcoins pump higher during Bitcoinâs consolidation phases, but that has not been the case this time.
While a selection of DeFi tokens and other obscure altcoins have moved higher, the majority of the top 20 coins are in the red today.
This is possibly due to the fact that investors are reluctant to shift funds into altcoins while the Bitcoin price is in such an indecisive position.
Experienced crypto investors know that a strong bullish breakout from BTC could result in altcoin-to-BTC pairs being crushed, whereas a bearish breakdown in BTC price tends to result in BTC and USD altcoin pairs receiving an equally catastrophic pummeling.
A few standouts of the day are AAVE with a 8.54% gain, Monero (XMR) moving 5.19% higher and Wavesâ rally of 6.23%.
According to CoinMarketCap, the overall cryptocurrency market cap now stands at $566.5 billion and Bitcoinâs dominance index currently at 62.6%.
Disclaimer
The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.