2018-11-19 17:39 |
We have another bearish start to the week for Bitcoin. Last week saw Bitcoin form a 2018 low just below $5200. This week has started extremely bearish with Bitcoin forming a new low below $5100.
After last weeks drop, Bitcoin price action traded in a range for a number of days. There was speculation that a bear flag may be forming. A bear flag occurs when price action trades in a range after an initial drop and follows this up with another significant drop. Today’s price action has executed the bear flag.
Price is currently trading around $5130, but it is currently extremely volatile and subject to rapid change. The daily candle forming is a Marubozu candle. A Marubozu candle has little of no wicks and long body indicative of strong movement in one direction. The drop is also on large volume showing significant strength behind it.
Sellet momentum is also extremely strong. The RSI has recorded its lowest point in history, and the MACD continues to diverge to the downside.
Bitcoin Daily Chart – Source: Tradingview.comThe hourly chart shows a long period of price action trading very little on low volume. Price was trading around the 50 EMA but began decreasing on significant volume over the past 12 hours. Price has moved from trading around $5500 to around $5150 currently.
When the price dropped below$5200 last week, it quickly bounced showing that traders were not yet willing to let it trade at such a low valuation. The fact that price is trading below $5200 for a longer period of time is a very bearish sign showing that traders are now willing to accept these lower valuations. Even if price increases from here, it is more likely to return to these levels.
With $5000 being a key psychological number, some support is likely coming in to play. If price breaks below here, the next support would be anticipated around $4500 to $4600.
Bitcoin Hourly Chart – Source: Tradingview.com Key Takeaways: Bear flag executes for price action of Bitcoin. Strong seller momentum with RSI reaching its lowest point in history and the MACD continuing to diverge to the downside. Support likely coming in to play around $5000. If this point breaks down, the next support point is likely $4500 to $4600. DISCLAIMER: Investing or trading in digital assets, such as those featured here, is extremely speculative and carries substantial risk. This analysis should not be considered investment advice, use it for informational purposes only. Historical performance of the assets discussed is not indicative of future performance. Statements, analysis, and information on blokt and associated or linked sites do not necessarily match the opinion of blokt. This analysis should not be interpreted as advice to buy, sell or hold and should not be taken as an endorsement or recommendation of a particular asset.Bear Flag Follows Through for Bitcoin [BTC] Price was originally found on [blokt] - Blockchain, Bitcoin & Cryptocurrency News.
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