news 
Bitcoin Price Analysis: BTC Tests Key Support as Further Breakdown Looms
As the crypto market continues to exhibit extreme volatility, Bitcoin (BTC) has recently broken down from its long-term ascending channel. The recent price action has left many investors questioning the sustainability of this rally and whether we are witnessing a significant top or merely a pause in an ongoing bull run.
In order to better understand the current state of the market and potential outcomes, we will delve into the technical analysis of the Bitcoin chart.
Firstly, let’s examine the daily time frame. As seen on the image above, Bitcoin has indeed broken down from its ascending channel, a development that could have significant implications for the broader trend ahead. It is crucial to note that this breakdown comes with considerable bearish momentum, as highlighted by the relative strength index (RSI).
This indicator remains under the 50 mark, suggesting a strong bearish bias. Furthermore, we can observe that Bitcoin’s price action has reached oversold conditions, which could potentially lead to a rebound in the short term.
However, this potential rebound would not necessarily be a convincing one if the $112K-$110K support zone fails to hold. A decisive breakdown below this area would significantly shift the market structure towards a bearish scenario for the weeks ahead.
In other words, it’s essential to keep a close eye on this region as it could set the tone for the short-term trend and potentially lead to further breakdowns in the weeks and months to come.
Now, let us look at the 4-hour chart. As you can see above, Bitcoin is now approaching its previous swing low of $112K-$110K. A decisive breakdown below this zone would be a significant indication that sellers are gaining control, paving the way for a potential crash towards the critical $104K level.
On the other hand, if the price manages to hold this key support area and bounce back from it, we could potentially see another phase of bullish continuation.
Source: cryptopotato.com
