Bitcoin has returned to the $40,000 levels as it bounced back from the high area of around $30,000. The first crypto by market cap managed to hold off the bears and retraced some of this week’s losses.
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At the time of writing, BTC’s price trades at $40,200 with a 3% profit in the last 24-hours.
The general sentiment in the market seems pessimistic as Bitcoin remains rangebound in higher timeframes. The cryptocurrency has been trading in the $30,000s to the $60,000s area, and in a tighter range over the past months.
Unable to break above local resistance, located at $45,000 and $48,000, market participants seem to have lost conviction over short-term appreciation unless BTC’s price can break above those levels.
According to a recent market update posted by Material Indicators (MI), in the current BTC’s price range, the area between $36,500 and $40,500 is the most critical. These levels operate as a consolidation range and as a zone that has a “marked prior accumulation phase and distribution”.
In other words, those levels have been important for Bitcoin because they provide clues on potential price action. As seen below, since 2021, when the cryptocurrency reaches these levels either trends upwards to the top of its range (around $69,000) or goes lower to re-test support.
In order to discover BTC’s current phase, MI analysts looked at the cryptocurrency’s heatmap along with three important moving…