Binance

Several technical levels overlapping around the same area usually makes it stronger and difficult to breach. BTC/USD has been fluctuating around its year-long average. In November price breached below the year-long average at 7,900 levels and since then it has remained below the important technical level. 

Over the past month, price formed a tight consolidation range between 6,500 and 7,900 levels. The upper boundary of the month-long consolidation and the long-term average are overlapping at 7,900 levels, making the technical level a strong resistance. Since July, the price action shows a steady downtrend (as marked by the downtrend channel). Failure to clear the resistance at 7,900 can eventually result in a breakdown below 6,500 levels (the lower boundary of month-long consolidation). A breakdown below 6,500 levels will resume the downtrend and confirm the month-long consolidation as a bearish continuation flag. It is important to note that volatility reached an extreme low as measured by Bollinger Bands. Low volatility periods are usually followed by high volatility periods. A breakout above 7,900 levels can confirm the consolidation as a reversal chart pattern and can start a new uptrend.