Bitcoin (BTC) could re-enter the $20,000 zone, but the coming weeks could offer a solid buying opportunity, a new report forecasts.
In his most recent market update On Feb. 24, the Decentrader trading platform exposed the last support zones between the current spot price of Bitcoin and $20,000.
An analyst watches the 20 and 200 week moving averages of BTC for clues
Russia’s military action in Ukraine has markets on edge this Thursday, with stocks and cryptocurrencies trending steadily lower as uncertainty grips Asia, Europe and the United States alike.
Bitcoin has already lost 12% in less than 24 hours, and expectations are that the worst is yet to come – reactions to the Russian offensive are still flowing, along with potential financial sanctions.
This is why Decentrader, like many other analysts, is remarkably careful in any trading decision.
“In times of uncertainty like this, it pays to be very clear about your strategy. For traders, having clear invalidation levels and strong risk management will allow them to survive,” summarized analyst Philip Swift.
“For long-term investors, we are approaching major historical support levels, and anywhere in this region is likely to be a good place to do dollar-cost-average in the coming weeks.”
Although never threatened in previous bear markets, a definite line in the sand for bulls comes in the form of Bitcoin’s 200-week moving average (WMA), which is currently sitting at $20,000 and rising.
The most likely, in Swift’s opinion, is a drop below $30,000 to deviations below the 20-week moving average, something that characterized the pit of the March 2020 COVID-19 plunge.
“Should the price continue to fall, the 20-week moving average deviation bands highlight a potential support zone for Bitcoin between $29,382 and $25,253,” the update explained.
“The last time the price deviated this much from the 20-week moving average was during the COVID crash in March 2020, although we were very close in the summer 2021 crash as well.”
Though hard to imagine, the upside targets in the event of a turn in Bitcoin’s fortunes are $37,500 and $41,100, he added.
Jaded Bitcoiners Watch Gold Rise
Decentrader is not alone in advising traders not to get carried away by emotion in the current circumstances.
The popular Crypto Chase Twitter account also called for common sense, arguing that there is no need to abandon long-term strategies.
“The next few days will most likely be volatile and headline driven. Most people would be better off with no change (myself included), but time will tell. This is typical trade, but with volatile times Caution is advised,” wrote in its latest update.
The battle between gold and digital gold, meanwhile, continues on the day, with XAU/USD hitting $1,970 and BTC/USD recovering only marginally from its overnight lows of $34,300.
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