Bitcoin experienced a significant price drop, reaching its lowest point in two months at around $56,550. However, just three days later, it made a remarkable recovery, surging over 12.5% and surpassing the $64,000 mark on May 4th. This resurgence can be attributed to the US Federal Reserve’s announcement to maintain interest rates unchanged until 2024.
On May 4th, Bitcoin’s price closed at approximately $63,966, above its 50-day exponential moving average (50-day EMA). This positioning suggests that the price may continue to rise towards the upper trend line resistance at around $69,650, which is located at the 0.786 Fibonacci retracement line.
Despite surpassing the 50-day EMA, Bitcoin faced resistance near the 0.5 Fibonacci retracement level at around $64,895. If it fails to overcome this resistance, it could enter a consolidation or even a reversal period. The next support level would be around $60,500, near the multi-month rising trend line.
In the event of a breakdown of the rising trend line support, Bitcoin’s price could potentially drop to the 0.0 Fibonacci retracement level at approximately $56,580 in May. Interestingly, analyst CrediBULL Crypto predicts a similar level of decline if the price retreats from the resistance area between $62,000 and $64,450.
Looking ahead, some members of the Bitcoin market remain optimistic about the possibility of a prolonged bull run in the coming months. Independent market analyst SHIB Knight predicts that Bitcoin’s price could reach $85,000 based on a prevailing bull flag setup.
Another analyst, Steph is Crypto, has set a six-figure price target for Bitcoin by referring to a breakout in the relative strength index (RSI). The RSI breakout observed on May 4th is similar to previous breakouts in January 2024 and October 2023, which were followed by a strong bull run, including a rise to $75,000 in March 2024.
It is important to note that the information provided in this article is not investment advice. Investors should be aware of the high volatility and risks associated with cryptocurrencies and should conduct their own research.
