Analyzing BTC/USD: Bitcoin's potential drop to $37,000 if $40,700 support is breached

BTC/USD chart and technical analysis

Bitcoin is retesting a major support level of $40,700 and if the price manages to break below this level then it will likely further drop to the $37,000 support level. The price has retested this level multiple times but was unable to break it and if it managed to close below this level then it will likely drop further.

I am waiting for the price to close below this level before entering for a short entry. The price is likely to retest the same level after breaching it. My entry will be $40,700 as this level then will act as a strong resistance.

The overall market structure is bearish and another drop seems certain. When the price ranges for a while then it usually drops further. The price ranges for a few days and then drops to new lows.

Bitcoin fundamental analysis

Fundamentally, the Bitcoin trader who called the $48K BTC price top flags a new bearish signal. According to some analysts, the recent drop might be more than a correction and the price will likely drop further.

Overall, there is uncertainty about where the price will go which is causing further sell-offs.

Bitcoin to Tether trade idea takeaways

• The price of  Bitcoin is likely to drop if it manages to break the $40,700 support level.
•  The price is likely to drop to the $37,000 support level in the coming days.
• Multiple take-profit levels have been added to secure profit along the way.
• The risk-to-reward ratio on this trade is 1:3.1.
• The entry and stoploss prices have been placed at secure levels with the least probability of getting hit.
• Good luck!