Bitcoin Traders Eye Support Levels as BTC Price Surges to $26.2K

BTC Price Rebounds on China Tax Cuts

Bitcoin (BTC) made a recovery from its weekly losses on August 28, thanks to a rise in risk assets following China's tax cuts. The BTC price witnessed an uptick, reaching $26,226, its highest level since August 25. This increase fully compensated for the previous night's weakness.

200-Week EMA Stands as Support

Traders are closely monitoring the 200-week exponential moving average (EMA), which is acting as a support level for Bitcoin. If the 200-week EMA holds, it suggests that the market is bottoming out and could provide an excellent entry point for traders. However, if the support is lost, the next major entry point could range from $19,500 to $21,500. Analysts indicate that the lower timeframes still show the possibility of the price dipping below the 200-week EMA, as long as the support level remains intact.

A trader named Van de Poppe suggested two strategies that could be deployed based on the price action. The first is an aggressive long entry at $25,750, with a target towards the other side of the trading range. The second strategy involves a sweep from $25,200 to $24,700-25,000, along with bullish divergences on higher timeframes, which could potentially trigger a reversal. However, in both cases, reclaiming the $25,750 level is crucial for the trades to remain valid.

Another prominent trader, Titan of Crypto, highlighted $25,900 as an important zone of interest for Bitcoin.

Bitcoin RSI Shows Extended Period of Low Levels

Bitcoin's relative strength index (RSI) on lower timeframes continues to show persistently low levels. The RSI has remained very low for 1.5 weeks, reaching levels not seen in five years after the recent 10% price dip. According to historical data, whenever the RSI went below 25 in the past, it corresponded to the local bottom and was followed by a minimum rise of 30%. However, there was one exception in September 2019.

It's important to note that this article does not provide investment advice or recommendations. Traders should conduct their own research and assess the risks involved before making any investment or trading decisions.