Bulls’ optimism is the dominant sentiment the day after the Bitcoin (BTC) price returns to the psychologically significant level of $ 40,000.
In addition to reversing this week’s local low of $ 37,500, Gary Gensler, chairman of the United States Securities and Exchange Commission, commented positively on the crypto industry and reaffirmed the goal of eliminate fraud in the ecosystem.
Now that the price of Bitcoin is back on track to $ 40,000, here’s what analysts and traders are saying about the best cryptocurrency.
Traders wait $ 40,000 to move from resistance to support
For many traders, $ 40,000 is a pivotal level for Bitcoin and the price performance from there could determine whether the market enters another bullish phase or simply rejects to retest the underlying support levels again.
As pseudonymous Twitter analyst Rekt Capital pointed out, the $ 40,000 price target is near the 200-EMA and it is crucial that Bitcoin secures a few closes above that moving average.
If this recent #BTC the rebound is just a rally of relief to turn the 200-day EMA back into resistance …
Then $ BTC could roll back to 50 day blue EMA
– Rekt Capital (@rektcapital) August 4, 2021
If Bitcoin fails to maintain that level, the 50-day EMA at $ 26,723 could provide the next area of support. Failure to hold above this level increases the possibility that BTC will return to its July lows.
Rekt Captial said:
“If BTC is unable to recover the 200-day EMA soon, it will become resistance again and may reject the price in the middle of $ 30,000.”
Bitcoin is at a make or break stage
The importance of a strong BTC close above $ 40,000 was also highlighted by pseudonymous Twitter analyst Fomocap, who posted the following tweet which identifies the $ 40,400 price as a key area to watch.
According to Fomocap, Bitcoin needs to close above $ 40,400 in order to solidify the uptrend and rejection at this level opens the door for a revision of the $ 30,000 range.
Based on the chart provided, the next support levels below $ 37,000 stand at $ 34,300 and $ 32,000.
Related: Panic Selling Is Crypto Investors Biggest Mistake, New Survey Reveals
Traders will remain undecided even if BTC hits $ 40,000
The indecision that controlled the price of Bitcoin throughout July still extends through August, meaning traders will advance slightly even if the $ 40,000 level is recovered.
Bitcoin at $ 37,000: bear market, failure as store of value, go to $ 20,000.
Bitcoin at $ 39,000: the ultimate inflation hedge, biggest store of value, go to $ 100,000
– Joseph Young (@iamjosephyoung) August 4, 2021
As it stands, a more decisive breakout that pulls the price of Bitcoin through the $ 40,000 to $ 43,000 resistance cluster is needed before traders gain confidence after this year’s historic highs.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move comes with risk, you should do your own research before making a decision.