BTC – “Short-Covering Advised around 20,000”

4-Hour Analysis:

Big Picture: Volatility was high, with overall price activity stuck inside a limited range. Bitcoin has held onto lower support levels, and further similar outcome will call upon a short squeeze backed by aggressive short-covering. Furthermore, sellers should consider profit-taking because the market could punish late sellers with a surprise push to the upside.

On the Upside the price has encountered stiff resistance at the intraday level of 21,550-21,750. Price has yet to close any 4-hourly candle above this level. The next wave of resistance appears at 22,200, followed by 22,450. This will be a major price barrier. If this level is successfully reclaimed, it will very certainly trigger aggressive short-covering, driving upside even farther into 22,800-23,000 levels.

On the Downside the levels of 20,750-20,400 remain solid. Any remaining selling pressure will be absorbed and exhausted by further strength at this level, perhaps triggering an intra-day reversal. If these supports are lost, the next supports will be at 20,000, then 19,800. Any strong selling into this area could result in a positive divergence, hence aggressive short-coverings are recommended in this region.