On December. 18 Bitcoin (BTC) price thrilled investors by providing a $one,000 move from $half-dozen,430 to $7,450 after bouncing off the descending aqueduct trendline about $6,400.

Multiple analysts from Cointelegraph contributor filbfilb to veteran commodities trader Peter Brandt all pointed to a popular logarithmic model that stressed the importance of the $6,400 level.

BTC USD 3-day chart

BTC USD three-day chart. Source: TradingView

This week's bounce off $6,400 is provided some brusque-term relief from investors believing that a BTC price catastrophe was avoided. Nevertheless, Bitcoin is non fully out of the woods yet.

Bitcoin flips dorsum to bearish

Since Thursday's 10% proceeds, the price has settled back below the $7,300 resistance and beneath the 20-day simple moving boilerplate of the Bollinger Bands indicator.

BTC USD 6-hour chart

BTC USD 6-hour chart. Source: TradingView

A drop to the lower Bollinger Ring would place the price beneath the $6,800 support and increment the chance of revisit to the descending channel support.

As mentioned previously, failure at the descending channel support ($6,345) also opens the door again for a driblet to $5,350. Since topping out at $7,452, the toll has painted a lower daily high and the 6-hour chart shows that momentum is fading as the price range tightens and moves closer to the xx-SMA.

Currently, the price is being held up by back up at $7,100 and if this gives way, a drop to $half-dozen,800 to $6,600 is likely.

MACD Histogram and RSI bear witness fading momentum

The same can exist observed on the moving average convergence divergence (MACD) where the histogram shows momentum slowing.

The MACD has ceased its rising by flattening and pulling closer to the signal line. The relative strength index (RSI) on the six-hour timeframe has besides flattened, mirroring Bitcoin'southward sideways price action.

Stay higher up $6.3K to avoid the fray

BTC USD weekly chart

BTC USD weekly chart. Source: TradingView

So, from the weekly timeframe, down to the 4-hour timeframe, Bitcoin price action is surly and needs to concord $6,685 to $6,274 to avert a driblet to $5,300 where the daily chart shows investors interest.

Anyone familiar with Bitcoin and crypto knows that the price activity is driven by more than just chart technicals. So allow's have a wait at some of the other factors that may be influencing Bitcoin's price.

Things to watch with Bitcoin price

This week Cointelegraph reported that long positions at Bitfinex continue to steamroll higher and this calendar week BTC/USD Longs have soared to a new all-fourth dimension loftier.

BTC USD Longs weekly chart

BTC USD Longs weekly nautical chart. Source: TradingView

Some analysts cautioned that Bitcoin is overdue for a strong squeeze on long positions and others attempted to decipher why long positions continue to rising in the face of increasingly surly toll action.

A full general theory is that investors believe Bitcoin toll will non fall far plenty to liquidate leveraged longs and with the 2022 halving result budgeted investors believe they have more to gain from being long rather than brusque.

Cointelegraph contributor Michael van de Poppe recently tweeted that the expectation that a long clasp is overdue is fake. He explained:

"There seems to exist a narrative that longs need to be squeezed before we tin move upwards. That'due south a wrong statement, based on history."

BTC USD Longs 4-day chart

BTC USD Longs 4-day chart. Source: TradingView

Co-ordinate to de Poppe:

"The ATH'due south of longs on Finex was constantly effectually a low of Bitcoin. They started to drop with a breakout upwards."

Bitcoin Unrealized Profit vs Unrealized Loss chart

Bitcoin Unrealized Profit vs Unrealized Loss chart. Source: glassnode.com

Another popular analyst, The Crypto Domestic dog, also posted a chart from blockchain analytics provider Glassnode, highlighting Bitcoin's Unrealized Profit vs. Unrealized Losses.  The annotator explained that:

"Bitcoin Unrealized Profit is depression at the moment & seems to exist trending down. At the aforementioned time, Unrealized Loss is trending up. Look out for a cross over, historically signaled bottoms."

Bitcoin Unrealized Profit vs Unrealized Loss chart

Bitcoin Unrealized Profit vs Unrealized Loss chart. Source: glassnode.com

The Crypto Canis familiaris suggested that "as traders have less turn a profit to realize, sell force per unit area could reduce."

Fear is on the rise!

Despite Th's $1,000 gain, investor sentiment remains strongly surly and the Crypto Fright and Greed Alphabetize currently shows a reading of 20, which falls into the 'Extreme Fear' category.

Bitcoin's Fear and Greed Index

Bitcoin's Fearfulness and Greed Index. Source: alternative.me

Many analysts counter trade the signals provided by the indicator. In other words, deeply bearish readings signal that it is time to purchase Bitcoin whereas overly bullish readings propose that it is time to sell.

Bitcoin's MVRV Z-Score and the NVT Signal suggest a little fleck more pain

MVRV Z-Score

MVRV Z-Score. Source: lookintobitcoin.com

The MVRV Z-Score also provides valuable insight into Bitcoin'due south current price action. Co-ordinate to market analyst Philip Swift, the indicator can be used to identify periods where Bitcoin is over and undervalued "relative to its fair value".

Swift further explains that:

"The MVRV Z-score has historically been very effective in identifying periods where marketplace value is moving unusually high to a higher place realized value. These periods are highlighted past the z-score (red line) entering the pinkish box and point the height of market cycles. Information technology has been able to choice the marketplace high of each cycle to inside two weeks."

The indicator also signals when the market is significantly below the realized value and this can be observed when the Z-score enters the green box.

Readers will observe that each strong parabolic rally was followed past the market cap (blueish line) dropping below the realized value (orangish line) for a prolonged period of time. A strong rally typically kicks off once the market cap crosses to a higher place the realized value as seen in January 2022, November 2022, and almost recently, in April 2022.

Currently, the market cap is drawing closer to a cantankerous with the realized value and the Z-score is dropping closer to 0 (the green box).

Bitcoin NVT-Point

Bitcoin NVT-Signal

Bitcoin NVT-Signal. Source: woodbull.com

Willy Woo's Bitcoin NVT Signal as well shows Bitcoin'southward price dropping closer to its realized value at $5,591 and the NVT signal is currently at 64.6 with 45 representing oversold weather condition.

All of this suggests that Bitcoin still has more bearish days ahead merely the macro view of the digital nugget'due south price activity remains encouraging, or perhaps i should say "exciting."

The iv-hour to weekly timeframe shows a bearish bias and the bounciness of the crucial support at $half dozen,400 failed to produce a tendency reversal. In fact, at the fourth dimension of writing, Bitcoin seems likely to once more retest the lower back up of the long-term descending channel.

Retests of $6,800, $6,400 and $six,300 are but going to concord and then many times; and with longs increasing at each retest, it'due south possible that buyers will dry up, giving bears the opportunity to push the toll to the $5,350 to $4,900 zone.

A drop to these levels would likely push button the marketplace cap below the realized value and the Z-score and NVT signal into oversold territory. If past performance can in any style be interpreted equally precedent, i would then surmise that this event would precede the commencement of a trend reversal and a new potent market rally.

Of course, all of this can exist averted and the entire surly analysis nullified if Bitcoin tin sustain above $7,600 and somewhen pause to a higher place the $7,800 to $eight,000 range to pull off a trend reversal.

Only time volition tell.

In the concurrently, swing traders and long-term investors could consider placing a buy order at $5,500 just in case; and solar day traders will go on to watch for Bitcoin cost to press above $7,300 and take some other shot at the resistance at $7,600.

The views and opinions expressed here are solely those of the author (@HorusHughes) and practice non necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should behave your own research when making a decision.