Bitcoin (BTC) is showing signs of weakness after failing to break through critical resistance levels, but an analyst is suggesting the current bearish momentum may be short-lived, though investors should brace for more near-term losses.
According to analysis by Master Ananda in a TradingView post on August 20, Bitcoin’s inability to move past the $122,524 resistance level has triggered a double-top bearish signal, pointing to the likelihood of a deeper correction in the short term.
The next key level to watch is the 1.618 Fibonacci extension at $102,077, which Ananda identified as the main support target, with the possibility of a further drop toward $100,000. While $112,000 has provided temporary support, the analyst believes it is unlikely to hold given the current long-term chart structure.
The correction, however, is expected to last only a few more days before Bitcoin finds its footing. Altcoins, which typically mirror BTC’s volatility, may also face short-term turbulence but are projected to recover quickly.
Despite the pullback, Ananda stressed that the broader crypto bull market remains intact.
“A drop toward $100,000 (above) would mean a full flush for Bitcoin and the doors opening for a new major wave of growth. Make no mistake, the current move is running its course. Bitcoin is likely to drop only for a few more days. Settle the low, recover long-term. The altcoins will shake but will also recover in a matter of days. This is a momentary event, Crypto will continue to grow. The bull market is not over. The best is yet to come,” teh analysts said.
Retail investors in panic
Still, investor sentiment has turned increasingly bearish. Data from Santiment shows the ongoing Bitcoin correction has shifted retail traders’ enthusiasm into panic, pushing social sentiment to its lowest level since June 22, when fears over Middle East tensions sparked heavy selling.
Bitcoin price analysis
At press time, Bitcoin was trading at $113,712, down 1.5% in the last 24 hours and more than 5% over the past week.
Currently, BTC is hovering just below its 50-day simple moving average (SMA) of $115,879, which now acts as short-term resistance. However, it remains comfortably above the 200-day SMA of $94,227, keeping the broader uptrend intact.
Meanwhile, the 14-day relative strength index (RSI) at 40.35 shows weakening momentum, edging closer to oversold territory and signaling caution.
Featured image via Shutterstock.
Source: https://finbold.com/bitcoin-set-for-a-full-flush-towards-100000-whats-next/
