The coin is on track for its biggest gain since February 8
Bitcoin price extended losses to fresh early-March lows just below the $47,000 figure earlier on Monday before bouncing strongly. The BTCUSD pair jumped above the $50,000 barrier, to touch the $53,000 level in recent trading. If the recovery continues any time soon, the coin could target the $55,000 figure next.
Today, the largest cryptocurrency is on track for its biggest gain since February 8, with the recent drop being seen as a great buying opportunity amid the current volatility.
Earlier this month, the digital currency reached a record $64,875 amid enthusiasm from the Coinbase Global Inc. listing. Since then, BTCUSD has been on the defensive, falling below the 100-DMA late last week for the first time since early October.
In part, the sell-off was due to a plunge in traditional markets that fell after the news US President Joe Biden was going to announce a bill to increase capital gains taxes for those generating an annual income of more than $1 million. Besides, BTC was pressured by reports about a collapse of two crypto exchanges in Turkey.
Now, the cryptocurrency needs to hold above both the 100-DMA and the $50,000 figure in order to confirm the recovery and extend gains in the short term. A decisive break above the $53,000 area would pave the way towards the $55,000 level, followed by the descending 20-DMA that now arrives just below the $57,000 figure.
As the daily RSI has reversed to exit the oversold territory, it looks like BTCUSD could see further gains in the near term. On the four-hour charts, the prices are now back above the 20-SMA, suggesting the coin could retain the current bullish bias in the immediate term. However, in a wider picture, downside risks continue to persist following a sell-off witnessed last week.