Bull optimism is the main sentiment of the day after the price of Bitcoin (BTC) returned to the psychologically important level of $ 40,000.
In addition to reversing this week’s local low of $ 37,500, Gary Gensler, the chairman of the U.S. Securities and Exchange Commission, posted positive comments about the crypto industry and reaffirmed the goal of smoothing out fraud in the ecosystem.
Now that Bitcoin price appears to be back on track to $ 40,000, that’s what analysts and traders are saying about the major cryptocurrency.
Traders expect $ 40K to move from resistance to support
For many traders, $ 40,000 is a pivotal level for Bitcoin and how the price works from here could determine whether the market enters another bullish phase or simply refuses to try lower support levels again.
As pointed out by the pseudonymous crypto analyst Rekt Capital, the price of $ 40,000 is close to the 200-EMA and it is important that Bitcoin secures a few closings above this moving average.
If this recent #BTC bounce is just an auxiliary rally to turn the 200-day EMA back to resistance …
Then $ BTC could retreat to the blue 50-day EMA
– Rekt Capital (@rektcapital) August 4, 2021
If Bitcoin fails to maintain this level, the 50-day EMA at $ 26,723 could provide the next support zone. Failure to hold above this level increases the possibility that BTC could return to its July lows.
Rekt Captial said:
“If BTC is unable to pick up the 200-day EMA soon, it will turn into resistance and could suspend price up to the mid-$ 30,000 mark.”
Bitcoin is in a ‘create or break’ stage
The importance of a strong BTC close to over $ 40,000 was also highlighted by pseudonymous Twitter analyst Fomocap, who posted the following tweet, which identifies the price of $ 40,400 as a key area to watch.
According to Fomocap, Bitcoin needs to close above $ 40,400 to consolidate the high trend and rejection at this level opens the door to a revisit of the $ 30,000 range.
Based on the given chart, the following levels of support below $ 37,000 are found at $ 34,300 and $ 32,000.
Related: Panic selling is the biggest mistake of crypto investors, a new survey reveals
Traders will remain undecided even if BTC reaches $ 40.00
The indecision that dominated the price of Bitcoin during July continues to extend through August, which means traders will step up a bit even if the $ 40,000 level is recovered.
Bitcoin at $ 37k: bear market failed as a value, until a review at $ 20k.
Bitcoin at $ 39k: the final inflation hedge, the largest value, until a review at $ 100k
– Joseph Young (@iamjosephyoung) August 4, 2021
As things currently work, a more decisive boom that raises Bitcoin price through the resistance cluster from $ 40,000 to $ 43,000 is needed before traders can gain the confidence chase after this year’s highs.
The opinions and opinions expressed herein are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you have to do your own research when you decide.