Bitcoin
Bitcoin (BTC) Technical Analysis: Bear Continues To Wreck Havoc
After a solid countertrend rally in July, which we anticipated and readied readers attention to of Global Coin Report, where Bitcoin generated a nearly 50% return for those whom participated in the move as well as reaching our noted measured move price objective in the 7800-8000 zone, BTC has since found the footing slippery and as a result, has now recently violated its former break-out point located at the 6900 level, which has precipitated further decline.
In our last missive,”Is The Countertrend Rally Over? “, we noted the following, “Moving forward, in order for BTC to ‘get going’ once again and resume its northern trajectory, both investors and traders may want to pay close attention to the 200 day SMA located at the 8440ish level as well as the 8510 and 9020 figures as potential overhead resistance levels to be cleared,” which did not not materialize and was a signal that the recent move may have exhausted.
We also went on to state, “Therefore, while BTC has and remains in ‘better’ technical shape than many of its brethren, and we’re not ready to officially declare that the forecasted countertrend rally is ‘Over’ just yet, we’re beginning to witness some signs that both investors/traders may need to ‘tighten’ things up and keep their positions on a tight leash”, which has since proven prescient.
With that behind us, let’s take a look at the Chart of Bitcoin to see what may be in store as we move forward.
As we can observe from the daily chart above, Bitcoin is short-term oversold and due for some price relief with BTC registering eleven (11) down days out of the past twelve (12) sessions, constituting severe oversold conditions.
Additionally, we can also see that the primary trend, which is lower, remains in effect as BTC continues to trade below all of its important moving averages (20/50/200 SMA), which portrays and unfavorable technical posture.
However, and perhaps most importantly, with Bitcoin recently having violated the 6900 level on the downside, which acted as the neckline (resistance) on its most recent inverted H&S pattern, which then turned to critical support, such level will now act as formidable resistance once again.
Moving forward, both investors/traders may want to utilize the following levels as a guide in navigating the landscape ahead.
If BTC can get itself going to the upside, which we suspect will occur in the days ahead in order to work-off the oversold conditions, the 6900 level should prove formidable short-term resistance. On the flip-side of the coin, potential short-term support resides at the 6200-6300 zone with minor support at the round 6000 figure as well as the 5700 figure providing more meaningful support.
Nonetheless, the July countertrend rally is officially over and after some short-term price relief, we suspect that Bitcoin and the entire cryptocurrency landscape is in for further downside action before this bear runs its course. In essence, the bear continues to wreck havoc throughout the tape.
We remain in a primary downtrend whereby risk management is imperative, particularly for those whom are trading the short-term blips.
~iBC
Happy Trading~
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Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and/or its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency and read our full disclaimer.
Image courtesy of Pexels
Charts courtesy of tradingview.com
Bitcoin price dumped hard on Monday, briefly slipping below $41,000, erasing gains recorded in the previous week. The premier cryptocurrency seems to have exhausted its recent rally propelled by industry vulnerabilities. At the time of writing, the world’s largest cryptocurrency was trading slightly lower at $41,385. Bitcoin’s total market cap has dipped by 2% over the past day, while the total volume of BTC tokens traded over the same period climbed by 58%.
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Bitcoin price has been facing retracements and a rollercoaster over the past few days after recently rocketing to a 20-month peak. On-chain data has suggested that many investors used the opportunity to take some profits, leading to a decline in the asset’s price.
Bitcoin’s price slump is mirrored in the wider crypto market, with the global crypto market cap decreasing by 1.85% over the past 24 hours to $1.55 trillion. The total crypto market volume has increased by 32% over the same period. The Crypto Fear and Greed Index has plunged from a level of extreme greed to a greed level of 70, suggesting a decline in risk appetite.
Ethereum, the largest altcoin by market capitalization, is currently trading at $2,167, down almost 3% for the day. Meme coins have been hit hard by the market slump, with Dogecoin and Shiba Inu down by more than 4% over the last day.
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Bitcoin price has been trading sideways over the past few days, suggesting a pause in its recent rally towards $45,000. The premier cryptocurrency has decreased by 4% in the past week but remains 15.22% higher in the month to date. The digital asset has staged a significant recovery this year after a torrid 2022 in which a string of scandals, including the collapse of FTX, led to a market meltdown, undermining the credibility of the sector.
The crypto market has been buoyed by the Fed’s latest interest rate decision. The US Federal Reserve on Wednesday held its key interest rate unchanged for the third consecutive time, in line with market expectations. With the easing of the inflation rate, members of the Federal Open Market Committee (FOMC) voted to keep the benchmark overnight borrowing rate in a targeted range between 5.25%-5.5%.
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Fundamentals
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According to analysts, with no spot bitcoin ETF approvals yet and the halving event five to six months away, the market is riding on FOMO. Capital has been flowing in the Bitcoin market amid enthusiasm that the launches of spot ETF will bring in billions of dollars of new investment into the crypto sector.
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