Bitcoin is struggling to rally after breaking below the psychological support level of $40,000. Volume candles spiked indicating huge liquidations and stop-loss collections.
If we look at the hourly chart, we see that Bitcoin started making lower highs from $50,000 down to $46,000 support. This support level was long tested until it broke towards $42,000 on January 5th. Bitcoin, again, is forming the same pattern by making lower highs towards the support of $40,000 so it’s very likely to plunge to the support of $37,000, fib 1.618. A break of the 100 EMA near $43,000 would be needed to break the downtrend cycle.
