Bitcoin plummets to $53,000 — Will the price consolidate in the future? | CoinDesk JAPAN

• Bitcoin again encountered significant resistance on the 20th at $53,000, a key level that capped the upside in the second half of 2021.
• One analyst believes that this resistance is consistent with the upper bound of the weekly Ichimoku cloud, a technical pattern that has capped upside in past market cycles, and suggests further consolidation for Bitcoin below $53,000. He pointed out that this may be a sign that something will happen.

Bitcoin (BTC) again faced significant resistance on the 20th at the critical $53,000 level (approximately 7.95 million yen, equivalent to 150 yen per dollar). This suggests that prices may continue to consolidate before the next big move.

Price movements were calm over the weekend when the United States had a three-day holiday, but on the morning of the 20th US time, Bitcoin rapidly rose from $51,600 to just below $53,000. However, selling pressure quickly forced the stock to pull back, dropping to $50,700. Since then, it has rebounded slightly and is trading at $51,260 at the time of writing. It is down 1.15% in the past 24 hours, roughly in line with the CoinDesk 20, which measures the overall crypto market performance.

The price movement of Ethereum (ETH) was similar, exceeding $3,000 for the first time since April 2022, before falling to $2,900 (approximately 435,000 yen).

Bitcoin's plunge is similar to its price action on the 15th and 16th last week, when it rose to over $52,500 during the day before falling sharply back. Looking at a broader range, it has been in the range of approximately $51,000 to $52,500 over the past week.

Will it remain flat in the future?

The failed attempt to break above $53,000 may portend further consolidation in the current range. The price appears to be taking a lull after rising more than 30% in late January following a correction triggered by Bitcoin exchange-traded funds (ETFs). This price range is a key resistance area on the long-term chart that capped the upside in the second half of 2021.

K33 Research analyst Vetle Lunde said on the 20th, “The current price level is an important technical level for Bitcoin, and is the peak of the rally triggered by “El Salvador'' in September 2021.'' “This is consistent with both the resistance and the resistance before the crash on December 4 of the same year.”

Analysts at crypto analysis firm Swissblock said last week that Bitcoin's stalled momentum could portend further pullbacks and buying opportunities.

$53,000 is the upper limit of Ichimoku Kinko Hyo

The $53,000 area is also the upper limit of the weekly Ichimoku Kinko Hyo cloud in past market cycles. While it was a major resistance for Bitcoin prices in 2016 and 2019, it paved the way for all-time highs when it broke out of this area in early 2017 and late 2020. Crypto asset technical analyst CryptoCon pointed out.

A chart by CryptoCon posted on X (formerly Twitter) shows that the price of Bitcoin first returned to similar levels in the last two bull markets, followed by a long period of consolidation. On the other hand, the breakout towards higher prices occurred later in the Bitcoin market cycle, after the quadrennial Bitcoin halving.

CryptoCon wrote in the post, “The upper cloud has been an intermediate top twice: a point of sharp resistance and a long period of sideways.” “It's a whole year early,” he said.

｜Translation and editing: Rinan Hayashi
｜Image: CoinDesk
｜Original text: Bitcoin Suffers Swift Reversal at $53K, Suggesting More Consolidation Ahead