If you’re reading this, Bitcoin has closed its daily candle and has just 48 hours or less to defend a key level.
With a monthly, quarterly and even higher time frame coming up in less than two days, crypto bulls are under a lot of pressure to fully retake the area.
The only line in the sand Bitcoin bulls need to defend
Every now and then a psychological level emerges that is of emotional importance to the market. A good example of this is Bitcoin at $10,000, $20,000 and now $30,000. However, this is not the limit to which we are referring.
Instead, a key technical level must be defended at all costs or the crypto market could see another downtrend. The level in question is not a complex technical signal, moving average or anything like that. The point is to draw a horizontal line from 2020 to today.
This level is of particular importance as it is the year-end 2020 and year-opening 2021 level. Annual open and close prices act as support and resistance on the time frame. Overcoming it and winning it back as a support is vital.
The most critical line in crypto | BTCUSD on TradingView.com
Highlighting the importance of the annual BTCUSD open and close price
As we discussed in previous content, the signals with the highest time frames tend to be the most dominant. This means that a support or resistance level on the yearly chart carries significantly more weight than the daily chart.
Roughly $28,888 is the price Bitcoin opened at in 2021. This area was first tested as support in the summer of 2021. It held up the first time, but didn’t hold up the second time it was tested again in 2022.
It has been more than a year since losing the support area and BTCUSD is trading above the zone that is now acting as resistance. The bulls are hoping to push the 2020 close and 2021 open back to support. If successful, the cryptocurrency market could return to previous all-time highs.
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$28,888 is mandatory to close on the 6M, 3M and Monthly charts which close in 72 hours
Charts 12M, 6M, 1M, 3M clockwise pic.twitter.com/MJVX7rSW7v
— Tony “The Bull” (@tonythebullBTC) June 28, 2023
Tony is the author of the CoinChartist (VIP) newsletter. Follow @TonyTheBullBTC and @coinchartist_io on Twitter. Or join the TonyTradesBTC Telegram for daily market insights and technical analysis training. Please note: the content is for educational purposes and should not be considered investment advice. Featured image from iStockPhoto, charts from TradingView.com
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