The leading cryptocurrency dropped below $40k last week but could recover above that level over the next few hours.
The cryptocurrency market lost over $100 billion in the past few days. The total cryptocurrency market cap dropped below the $1.8 trillion mark after closing in on $1.9 trillion last week.
The bearish performance comes as Bitcoin and the other leading cryptocurrencies recorded losses. Bitcoin dropped from the $43k level to $38k within a few days. However, it is now slowly recovering and could be on track to recover some of its lost value.
At press time, Bitcoin is up by less than 1% over the past 24 hours and currently trades above $39k per coin. If the positive momentum increases over the coming hours, BTC will soon surpass the $40k psychological level.
Over the past few weeks, the broader cryptocurrency market has been volatile, and the situation could likely stay the same heading into the new week.
Key levels to watch
The BTC/USD 4-hour chart is still bearish as Bitcoin sustained huge losses over the past few days. However, the technical indicators show that Bitcoin is slowly recovering some of its lost value.
The MACD line is still within the negative territory but could soon cross into the positive zone if the bulls remain in charge. Bitcoin will need a sustained bullish run for the MACD line to enter the positive region.
The 14-day relative strength index of 38 shows that Bitcoin is still in the oversold region. This is due to the huge selling pressure it faced last week.
However, if the bullish momentum is maintained, the RSI could cross the 50 mark soon, and Bitcoin will be out of the oversold region.
If the current market conditions improve, Bitcoin could rally past the $40k psychological level before the end of the day.
In the event of an extended rally, Bitcoin could target the major resistance level around $42k later this week.