Bitcoin Enters “Chop Mode” as Analysts Eye Potential Consolidation Phase
- Bitcoin has yet to break above any key resistance levels over the past couple of weeks, with the resistance at $16,000 holding strong
- The selling pressure here has proven to be significant and has stopped the cryptocurrency’s immense uptrend right in its tracks
- Where the entire market trends next will likely depend on how Bitcoin trades as it nears this crucial level
- One prominent trader is stating that he expects Bitcoin to see further chop in the near-term, with this consolidation being more likely than a “deep retrace.”
- Should this trend play out, this could be highly positive for altcoins, allowing many to further extend their recent momentum
Bitcoin and the aggregated crypto market have seen mixed price action throughout the past few days.
While BTC has formed a large trading range between $14,800 and $15,800, most altcoins are now catching up to the benchmark cryptocurrency’s recent gains.
Its consolidation phase has bolstered its outlook, potentially opening the gates for altcoins to see further momentum in the days and weeks ahead. Ethereum’s strong uptrend has enhanced this possibility.
One trader explained in a recent tweet that he believes further sideways trading is a more likely possibility for Bitcoin than it seeing any sharp retrace in the near-term.
Bitcoin Pushes Higher But Remains Rangebound
At the time of writing, Bitcoin is trading up just over 2% at its current price of $15,650. This is around the price at which it has been trading throughout the past week.
Bulls and bears have formed a relatively wide trading range as of late, which was confirmed earlier this week when BTC’s price rallied to highs of $15,800 before facing a swift rejection that sent it down to $14,800.
It has been trading between these two levels ever since, being unable to gain any decisive momentum.
BTC Likely to See Further Chop as Uptrend Stalls
So long as Bitcoin remains below $16,000, one well-respected trader believes that the cryptocurrency will see further sideways trading.
He spoke about this in a recent tweet, adding that sideways trading is more likely than it seeing a deep retrace.
“Quick update: BTC still in chop mode, no break and hold of resistance yet but i’d imagine that’s more likely than a deep retrace. In the event of a retrace looking at the sub 14k area to fill longs. Just watching for now, no +EV trades here imo.”
Image Courtesy of Flood. Source: BTCUSD on TradingView.
How Bitcoin trends next will likely depend on its reaction to $15,800 and $16,000. A rejection here could confirm that it is in for a prolonged consolidation phase, whereas a break above this level will put a move to all-time highs on the table.
Featured image from Unsplash. Charts from TradingView.