Bitcoin price briefly hit new all-time highs today, but as the market starts to get overheated, fresh bids to take the BTCUSD towards the 50,000 mark dried up.
This is coming as PayPal’s CFO John Rainey tactically took the company out of the rush to adopt Bitcoin in some form, declaring that PayPal would not consider buying cryptocurrency or allocating portions of its cash holdings in cryptos.
Despite confirming interest in the potentials that cryptocurrencies offer, Rainey said: “We’re not going to invest corporate cash, probably, in sort of financial assets like that.”
His comments appear to have affected Bitcoin prices, which are trading 1.67% lower as at the time of writing.
Technical Levels to Watch
A look at the 4-hour chart shows the presence of a rising wedge, following today’s approach to new highs above 40,000. The active 4-hour candle has violated the lower edge of the rising wedge. However, there has to be a confirmed breakdown of the wedge for the correction to kick in. This breakdown move has the potential to send BTCUSD back to the 44,138.76 support formed by the 61.8% Fibonacci retracement from the price swing of March to August 2020. Below this level, a demand zone could appear between 40981.89 and 41237.02. Failure to attract bids at that range could allow sellers to drive prices lower, targeting 38162.46.
On the flip side, the reappearance of demand at 44138.76 or the 40981.89/41237.02 range could allow for a resumption of the uptrend, targeting 48270.05. Only a break above this level opens up the pathway to 50729.16 (88.6% Fibonacci extension).
BTCUSD Daily Chart