Bitcoin's price has been under significant pressure, but Glassnode, a prominent blockchain analytics firm, suggests that there are four major support levels that Bitcoin traders should not overlook.
According to Glassnode, the Bitcoin spot price is slightly above its 111-day moving average (DMA) and its 200-week moving average (WMA), providing a support area for the cryptocurrency. This places the first two levels at around $26.2K. These lines act as price floors, where buying pressure might be strong enough to halt or even reverse the recent downtrend.
When evaluating for common technical pricing models, we note that the #Bitcoin spot price remains marginally above the currently equivalent 111 DMA and 200 WMA, providing a region of support.— glassnode (@glassnode) May 24, 2023
In the event of a volatile move below the aforementioned models, the confluence between… pic.twitter.com/4Dr0fmyyig
However, in case of a volatile drop below these levels, the analysts point out a confluence of the 365 DMA and the 200 DMA as another critical support zone. This range, between $22.3K and $22.6K, could be a crucial battleground for bulls and bears, should the price drop to these levels.
As such, these are the four significant support levels identified by Glassnode: the 111 DMA is at $26,200, the 200 WMA is at $26,200, the 365 DMA is at $22,300 and the 200 DMA is at $22,600.
At the moment, Bitcoin's price is fluctuating between the 50- and 200-day exponential moving averages (EMAs). The trading volume has been on a downward trend, which might suggest a decrease in trader activity or interest. Concurrently, the Relative Strength Index (RSI) is at a low. This could suggest that the bearish momentum is slowly waning, potentially paving the way for a bullish rally.
These support levels provide a framework for understanding potential price movements, and traders and investors should incorporate them into a broader analysis and risk management strategy, instead of relying on them exclusively.