Bitcoin (BTC) Price Prediction: BTC/USD Could See Sideways Action or a Small Rally, But Long-Term Outlook Stays Negative

Bitcoin is currently trading above the $61k level and a small recovery could be on the horizon. However, according to analyst Josh of Crypto World, Bitcoin

Bitcoin price showed some recovery on Monday, rising back above the $61,000 level. BTC price had dropped to lows of $59,800 on Sunday, continuing last week’s sell-off.

Bitcoin price opened the week in a positive note, with BTC/USD rising from Sunday’s lows to trade above the $61,000 level on Monday.

The world’s largest cryptocurrency began last week trading at around $68,000, but closed the week down over 10%, following a sell-off that saw prices fall to a two-week low.

Despite Monday’s recovery, one analyst believes that Bitcoin is still set for further declines, with key resistance levels yet to be broken.

Bitcoin price recovers from lows, but still in danger of further declines

Bitcoin price showed some recovery on Monday, following a sharp sell-off at the end of last week that saw BTC/USD fall from highs above $68,000 to lows of $59,800 on Sunday.

From Sunday’s lows, BTC price began to recover, rising to highs of $61,400 during Monday’s session, before later trading at around the $61,100 level.

Monday’s recovery comes after a seventh consecutive weekly close in the green for Bitcoin, with the token now up over 250% year-to-date.

However, despite the recent rally, analyst Josh of Crypto World believes that Bitcoin could still be set for further declines in the short-term.

Speaking in a recent YouTube video, the analyst said that while Bitcoin may experience sideways price action or a small rally, this does not change the fact that the longer-term outlook remains negative.

“We’re still looking at lower highs and lower lows on the higher time frames, and until we can break through those major resistance levels, the bias is still to the downside.”

Bitcoin price key support & resistance levels

Bitcoin price is currently finding support between $60,000 and $61,000, which has held up well over the past few days. If Bitcoin breaks below this support, the next levels to watch are $59,500, $58,000, and a more substantial support zone between $56,000 and $57,000.

If Bitcoin experiences a short-term bounce from its oversold levels, we can expect resistance at around $61,900 and $63,300. If the price moves higher, more resistance can be found at $64,500, and then again between $67,000 and $68,000, which is the upper resistance range where Bitcoin has been repeatedly rejected.

DXY index breaks out to the upside, bearish for Bitcoin

The U.S. Dollar Index (DXY) has recently broken out to the upside, which is typically a bearish signal for Bitcoin.

The DXY has formed a double bottom (W pattern), which hints at a bullish trend for the U.S. dollar. Historically, Bitcoin and the DXY tend to move in opposite directions, meaning that as the DXY rises, Bitcoin’s price tends to fall.

This negative correlation between Bitcoin and the DXY isn’t perfect, as there are times when they can move together. However, more often than not, they trend in opposite directions.

Recently, as the DXY began to rise, Bitcoin’s price has seen a downward movement, which further confirms this negative correlation.

Bitcoin price’s short-term oversold signal

While the DXY is putting bearish pressure on Bitcoin, a short-term positive indicator has appeared for Bitcoin: an oversold signal.

This means that Bitcoin’s recent price drop has been so significant that it is now considered “oversold,” according to technical indicators like the Relative Strength Index (RSI).

When Bitcoin becomes oversold, it typically suggests that the selling pressure is overdone, and there may be a short-term bounce in price. However, this doesn’t mean that Bitcoin will enter a long-term uptrend.

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