When Wall Street's closing bell rang on March 20, 2020, Bitcoin's price showed a sharp correction. It pulled back to less than $6,000 just 24 hours after hitting a seven-day high of $6,900. The nearly $1,000 drop from $6,670 to $5,670 likely shocked investors because it was below what the analysts estimated its price correction level to be. It looks like traders are buying into the dip, so a return to a higher level is likely.
The price bounced at $5,700. The bulls are in the process of pushing it above the $6,200 mark. After the week's huge 82.4 percent recovery from a low of $3,775, Bitcoin felt a little overdue for a pullback. In a previous analysis of Bitcoin's value, analysts expected it to resist some of the underlying support at price points of $5,380, $5,500 or $5,900.
Although there was a $1,000 fall to $5,690, the RSI on the four-hour time period remains in a trend upwards above the trend line, reaching bull territory around 62. The MACD curved down from the overbuying region. Momentum is on the side of the histogram that demonstrates steady value and volume. The buying volume is about even with the selling volume that was in place before the price pull-back. Experts think that if the bulls can reclaim a value around $6,400, this will be a Bitcoin victory.
Over the next few hours, the traders should keep a close eye on volume over short time frames. They should also watch the RSI. If it dips below the trend line on the four-hour frame, there is a chance its value will drop more. There is also a dragonfly doji candle on the four-hour price tracking chart. This suggests a possibility of s short-term trend reversal. This is supported by the RSI and MACD.
If there is a short-term value reversal, traders should look for a bounce around $5,450. A strong upsurge from the weekly low can only be sustained if there is underlying support. Since the bulls bought into the current dip, Bitcoin might have that support. Investors should continue watching it closely.