12-Hour Analysis:
Big Picture: The narrow range levels were ultimately breached, but towards the downside, exposing Bitcoin to the recent lows. Over the weekend, massive selling pressure remained in place, effectively undermining any attempts at price recovery. The downward pressure remains quite significant, but a CME gap of 26,475 levels was left behind over the weekend. Price may return to this level for inefficiency filling before starting additional rounds of selling.
On the Upside Bitcoin has many significant resistances right above the current levels of 26,020. The horizontal and dynamic resistances converge at levels ranging from 26,200 to 26,600. The dynamic EMA resistance seen here is the EMA-200, which has only been breached once since January, and that too for a very limited period. The EMA, on the other hand, is currently forming an effective resistance level. Bitcoin must retake this range in order to offset the present pressure and induce some stronger rounds of short-coverings.
On the Downside Bitcoin has been prevented from entering strong selling territory by the trendline support and the major supports below. Holding onto these supports at 25,200 to 24,900 may cause an intense wave of short-coverings, which could potentially take the form of panic short-coverings. However, to push panic short-coverings, acceptance beyond 26,600 will be important. If price continues to reject this resistance, the lower supports are likely to weaken, paving the door for a much larger sell-off.
