Bitcoin Price Levels to Watch as Cryptocurrency Falls Monday After Strong Month

Bitcoin (BTC) lost ground Monday morning, giving back some of the gains posted during what has been a positive month for the legacy cryptocurrency.

Gains in recent weeks have been driven in part by the Federal Reserve’s first interest rate cut in four years and the announcement by Chinese authorities of wide-ranging economic stimulus measures. Despite Monday’s decline, bitcoin is still up about 8% since the start of September, a month when its performance typically lags.

Below, we take a closer look at bitcoin’s chart and use technical analysis to point out important price levels to watch out for heading into October.

Descending Channel Breakout Alert

Bitcoin’s prince has oscillated within a multi-month descending channel since setting its record high in March. 

More recently, after bottoming out earlier this month towards the pattern’s lower trendline, the cryptocurrency’s price has staged an impressive rally to the formation’s opposing trendline, reclaiming the the closely watched 200-day moving average (MA) in the process.

Amid the potential for a breakout above the descending channel, we’ll point out several key overhead price levels to keep in mind, while also identifying a key support area to watch out for during potential retracements.

Key Overhead Levels to Watch

The first level to keep track of sits around $68,500, a location just above the channel’s upper trendline where the price may encounter resistance near twin peaks that took shape throughout July.

A rally above this level could see the cryptocurrency’s price move up to the $72,000 level, where investors who bought at lower prices could look to lock in profits near multiple peaks just below the all-time high (ATH) that formed on the chart between March and early June.

To project a price target above the ATH, we can use a bars pattern. To do this, we take bitcoin’s trending move higher from January to March and position it from this month’s low, which forecasts an upside target of around $97,000. We selected this prior move as it followed a pullback of around 22%, not unlike the current bullish move, which started after a 19% dip.

Important Retracement Level to Monitor

Upon a retracement from the descending channel’s upper trendline, investors should eye the $60,600 level, an area where bitcoin’s price finds a confluence of support from the 50-day MA and a trendline linking a series of comparable trading levels from February to September.

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As of the date this article was written, the author does not own any of the above securities.