The cryptocurrency market faced a new round of sales on September 20, when global financial markets were pressured by fears of a possible default by Evergrande Group, a Chinese real estate company whose collapse could send stock markets volatility.
Data from Cointelegraph Markets Pro and TradingView shows that Bitcoin (BTC) sales intensified from early morning to noon when the price dropped to a low of $42,493 before the bulls managed to pull it back above $43,500.
4 hour BTC/USDT chart. Source: TradingView
With fears mounting and uncertainty spreading in the market, here’s what analysts have to say about price action on September 20th and what to expect in the coming days.
A bearish reversal has become a warning
The bitcoin price drop surprised many in the crypto market, but according to analyst and Twitter user John Wick, the price action that led to the pullback on September 20 formed a confirmed bearish reversal range on the four-hour chart, indicating that a move was imminent. . Possibility.
According to the trader, the decline follows the latest developments regarding Evergrande, which really started to gain attention last week when a bearish reversal pattern for Bitcoin was formed.
It will likely take several weeks before the Evergrande events unfold and impact global financial markets, suggesting that traders may face a period of increased volatility.
Traders are anticipating a recovery from $42,000 to $44,000.
Crypto analyst and Twitter user alias CryptoCapo provided insight into the key levels to look for, as he published the following chart, highlighting the $42,000-$44,000 support zone and the $38,000 lower support area.
4 hour BTC/USD chart. Source: Twitter
– I bet a bounce from the blue zone, but if it breaks through the zone and test it again, the green will be in play. Both are good entry prices for what’s to come in the coming months (over $100,000). ”
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The market now looks oversold
The latest part of the analysis was conducted by independent cryptocurrency trader and market analyst Scott Melker, who posted the following tweet which showed that the lower prices had resulted in a bullish divergence in the oversold territory on the 4-hour chart.
As Melker confirmed, BTC price action over the weekend issued a warning before pulling back on September 20, when it formed a bearish divergence in the overbought territory with the RSI lower.
Now that the market has returned to oversold levels, the analyst is expecting another bullish divergence, which may serve as a signal that it is safe to enter the market again.
The total cryptocurrency market capitalization is now $1.952 trillion, with Bitcoin dominance at 42.5%.