An analyst says February could bring a positive turn if $37,000 holds as key monthly support, potentially opening the door to $50,000.
Bitcoin price has failed to break above $39,000 this week, despite several attempts after the rally from a low in the $33,000s last week.
BTC is currently down about 2% and is looking to re-test the $38,000 support level. If that level does not hold, the flagship cryptocurrency could slide further.
Pseudonymous crypto trader and analyst Rekt Capital notes that recent drops have kept Bitcoin in a consolidation phase, with support and resistance defined by two exponential moving averages (EMAs) on the weekly chart.
He says Bitcoin has slipped below those two EMAs, which on the macro view represent the mid-range area.
“Since BTC lost the Mid-Range area as support … it has visited the Macro Range Low area (green). Macro-wise, however, BTC is still consolidating between $28,000–$68,000 (green–red),” he wrote in a tweet shared on Wednesday.
Chart showing BTC price below the two EMAs. Source: Rekt Capital on Twitter.
On the micro scale, #BTC has broken down from the micro-range formed by the two EMAs
This EMA-formed range figured as the macro Mid-Range
Because macro-wise, $BTC is still just consolidating inside its Re-Accumulation range ($28000-$68000; green-red)#Crypto #Bitcoin pic.twitter.com/QWbRHwVS24
— Rekt Capital (@rektcapital) January 9, 2022
According to the analyst, Bitcoin is positioned to trade within the lower half of its $28K–$68K macro range for the coming weeks. The reference crypto should remain inside this “macro range” in the near term, Rekt added.
He highlights $43,000–$48,000 as critical resistance levels where BTC is likely to oscillate until buyers reclaim the two EMAs. If that occurs, he expects momentum could push Bitcoin back into the upper half of the $28K–$68K range.
Weeks ago, #BTC lost its Mid-Range as support
Which means BTC will occupy the lower half of the $28K-$68K macro range for the next weeks
BTC will stay below $43-$48K until BTC is able reclaim these two EMAs to confirm a return into the upper half of the range#Crypto #Bitcoin https://t.co/2Gs7jL6cvo pic.twitter.com/6m1SWgtSZG
— Rekt Capital (@rektcapital) February 2, 2022
BTC poised for a “green February”
Looking at monthly support, the analyst notes Bitcoin has seen three consecutive negative months so far, including January when BTC/USD fell more than 20%.
Rekt expects Bitcoin may reverse in February. His outlook calls for a retest and bounce from a key level around $37,000.
Beyond the green Monthly support level, #BTC has only ever seen a 3-month downtrend, at most
The last time $BTC experienced a 3-month downtrend beyond the green level…
BTC enjoyed a green Monthly candle
Could BTC be setting itself up for a green February?#Crypto #Bitcoin pic.twitter.com/MJQXv4QC0q
— Rekt Capital (@rektcapital) February 2, 2022
“The last time BTC managed to flip this support level was in August 2021, and the retest preceded a move to $50,000,” he added.
The previous rebound from lows around $30,000 occurred in July 2021, leading to a rally past $52,000, followed by a retest near $40,000 and then another surge into the all-time highs in November.