Check out these 3 BTC price levels if Bitcoin breaks below $55k

Bitcoin (BTC) prices continue to face depression as the total cryptocurrency market cap slips below $2 trillion. The crypto fear and greed index shows “extreme fear” in the market for the first time since the first week of August.

Let's examine BTC's price level below $55,000, which should provide support and potential breakout areas.

On the 1-hour chart, Bitcoin rose to $57.4k.

On September 6, Bitcoin registered a monthly low of $55,250, but on the positive side, it tested the zone of interest that has not been touched since August. Establishing a lower low on the 1-hour chart would allow BTC to make an immediate swing high towards $57,500.

Moreover, on the 4-hour chart on September 4, there is a significant difference between the price and the Relative Strength Index (RSI).

Each swing low on the hourly chart saw an average recovery of ~4% on the 1-hour chart in September.

A 4% recovery is currently around $57.5K-$58K.

At $57.5K, there are also upside liquidity positions. After the low-side liquidation in the last few hours, the price may move back in the lower price range, which day traders may take the liquidation pool as a short opportunity.

The value realized by short-term holders is $52K.

A daily close below $55,000 opens up the possibility of further downside for BTC price over the next few days. Losing the interest zone at $55,000 would open up a retest for Bitcoin around $52,100.

Axel Adler Jr., a Bitcoin researcher, highlights that this is the “next-closest target” given the current value of short-term holders.

In addition, the range between $50,500 and $53,000 is characterized by large whale stocks from February 2024.

Liquidation on $49k?

If BTC fails to hold $52,000, $49,000 should be the last support price, and the long-term bullish structure will face severe bearish pressure.

Similar to the previous bull run in 2021, BTC will retest the 50-week EMA if it declines to $49,000 in the coming weeks. Bitcoin has not closed a weekly candle below the 50-week EMA since October 2023.

In the year In 2021, Bitcoin maintained a weekly position above the 50-week EMA, and the indicator found support before the second leg of the rally. The RSI has also reset around the 50 level, and a similar reset is underway now.

RELATED: Arthur Hayes Threatens Bitcoin's ‘Dazzling' Trend Reversal With Price Below $50K BTC

If the price action repeats, Bitcoin should consolidate below $50,000 for the long term as it leads to a weekly close at the key EMA level.

Finally, another sweep to the $49,000 H2 2024 bottom may occur before the bull cycle resumes.

This article does not contain investment advice or recommendations. Every investment and business activity involves risk, and readers should do their own research when making a decision.