Bitcoin'south price has seen massive gains in contempo months, accelerating from $xi,000 to almost $62,000. Nonetheless, such impressive rallies also include relatively at-home periods of price action.

These periods are consolidative and are needed for the market place to find a new floor. In bull markets, bullish continuation is likely afterward these periods of ranging earlier another leg up tin can happen.

Currently, Bitcoin'south (BTC) price seems to be in such a menstruum merely over a week after hitting all-time highs above $61,000.

The $53,000 level has to hold to avoid more than downside

BTC/USD 4-hr nautical chart. Source: TradingView

The four-hour chart for BTC/USD shows a clear downtrend since its contempo all-fourth dimension high in mid-March. This happened after a breakthrough past $58,000. However, this movement showed weakness, as in that location wasn't whatever sign of new buyers stepping in for more upside.

In other words, a bullish strength would exist demonstrated with an increase in volume, which didn't happen. Therefore, a correction dorsum to $50,000 is a very normal, salubrious occurrence for this market.

Moreover, the chart shows a short-term downtrend in which lower highs and lower lows are being synthetic. In this regard, Bitcoin's toll landed in the $53,000 support zone, which tin be classified equally the disquisitional support zone to hold.

If this $53,000 support doesn't concur, a further correction toward $49,000 to $50,800 is inevitable, and the markets are going to see more blood.

On the other manus, if the $53,000 surface area holds, Bitcoin'due south price has to break through the $56,200 expanse to generate strength once again. In that regard, the $56,200 area can be considered the critical resistance zone to suspension at the moment.

Nevertheless, even if $56,200 breaks, at that place are still other resistances remaining overhead before Bitcoin's cost tin can aim for new best highs.

Daily time frame shows massive balderdash bicycle

BTC/USDT one-twenty-four hours chart. Source: TradingView

The daily chart for Bitcoin shows an apparent bullish cycle that's constantly making higher highs and college lows. Traders and investors should e'er zoom out to avoid any confusion regarding the overall trend. Only put, the price activeness of Bitcoin is yet bullish.

Therefore, a correction to the $50,000 area would notwithstanding be very normal, if non expected, every bit the $50,000 surface area is a massive support zone.

Even if Bitcoin'southward toll corrects further to the $44,000 area, the bullish construction is still valid, every bit these sideways ranges have been happening quite frequently since breaking the 2017 all-fourth dimension high.

As long every bit Bitcoin stays above $44,000, and preferably $fifty,000, the surly deviation will become invalid, equally history has shown multiple examples of this.

Similar construction seen later on the halving in 2020

BTC/USDT 1-24-hour interval chart. Source: TradingView

The nautical chart construction after the halving of May 2020 looks identical to the recent price activity of Bitcoin. In that sense, a failed breakout doesn't guarantee that a carry market is imminent.

Bulls should be patient, as a new floor may exist established for Bitcoin'due south price. After this compression and structure, a new impulse wave can happen once again, every bit seen in August 2020. In that period, Bitcoin's price accelerated from $nine,500 to $12,000.

The chart to a higher place shows the invalidation of the bearish divergence, as new lower lows did not occur. The current toll action could be painting a similar film, in which a bottom has to be fabricated between $44,000 and $50,000 to avoid new lower lows. If that happens, Bitcoin's price will invalidate the bearish divergences and the balderdash market volition continue.

The views and opinions expressed hither are solely those of the writer and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your ain research when making a decision.