FX.co ★ Bitcoin holds above 41,967.50

Bitcoin has been declining since December 27 after registering a false breakout above 51,991 static resistance. Today, BTC/USD reached the 40,600 level registering a new low. At the time of writing, the price is traded at 41,715.50 below 41,967.50 broken support.

BTC/USD dropped by 5.88% from 43,135.35 today's high to 40,600 daily low. The selling pressure remains high even if the crypto reached dynamic support. Still, after its sell-off, the price of bitcoin could try to rebound and recover.

BTC/USD challenges the median line

Bitcoin ignored the 41,967.50. Now, it challenges the median line (ml) which represents dynamic support. As long as it stays under the 41,967.50, it could resume its drop along the median line (ml). A valid breakdown below the median line (ml) could announce a sharp drop.

It remains to be seen how it will reach the median line. A strong bullish pattern may announce that the downside movement is over and that the price could develop a new swing higher.

BTC/USD outlook

After its failure to reach and retest the descending pitchfork's upper median line (uml), BTC/USD was somehow expected to be attracted by the median line (ml). Coming back and stabilizing above the 41,967.50 may announce a potential rebound. After testing and retesting the median line (ml), bitcoin could start increasing. A new higher high, a bullish closure above the 42,745.20 could signal a larger rebound.

A new lower low, a bearish closure below 40,600 today's low could activate a larger drop. You should keep in mind that a rebound could bring new selling opportunities.