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Technical Analysis for BTCUSD for 4th February 2022

Will Bitcoin Hold Above January 2022 Lows of $35k?

Days after President Putin of Russia backed the regulation of cryptocurrency mining, the Kremlin now estimates its annual revenue could exceed $2 billion.

Past Performance of BTC

The Bitcoin price continues to slide under the weight of sellers reading from price action in the daily chart. While there were encouraging higher highs in the second half of January, the bearish engulfing bar of February 2 makes traders more apprehensive. The general sentiment is now bearish following the confirmation of sellers on February 3.

Bitcoin Technical Analysis

There is a double bar formation signaling bulls peaks from the multi-week resistance line. The confirmation of selling pressure of mid this week hints at possible exhausted bulls as prices are now back, capped inside the bear bar of January 21 and 22. Technically, the short-term trend depends on the reaction at $40k and $35k—on the lower end. A close below $36.5k confirms sellers from a volume analysis perspective. In that case, BTC prices would likely sink below $36.5k and $35k, dropping to as low as $30k. On the reverse side, optimists should expect a close above $40k at the back of high trading volumes to signal a trend shift, supporting buyers.

What to Expect of BTC

Candlestick formation is, overall, supportive of bears. Accordingly, aggressive traders may unload on pullbacks towards $40k targeting $35k—or lower in the short-term. Unexpected gains above $40k would drive BTC higher towards $45k.

Resistance level to watch: $40k

Support level to watch: $35k

Disclaimer: Opinions expressed are not investment advice. Do your research.

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