2018-10-11 07:09 |
Bitcoin appeared to make an upside break from the long-term triangle consolidation but wound up falling through a short-term triangle support. This brought price back to the longer-term floor, which bulls seem to be defending for now.
A bounce off this support could take bitcoin back to the triangle top and perhaps on another attempt to break higher. If so, price could climb by roughly the same height as the chart pattern. Similarly sustained bearish pressure on the recent move might spur a drop that’s the same size as the large triangle as well.
The 100 SMA is currently above the longer-term 200 SMA to indicate that the path of least resistance is to the upside. In other words, support is more likely to hold than to break, although the moving averages could simply be oscillating to reflect consolidation.
Stochastic is turning higher to show that buyers are trying to regain control and keep the floor intact. However, RSI has room to fall before reaching oversold levels so bearish energy might stay present for a bit longer. Turning back up could lead to a return in buying pressure, though.
Cryptocurrencies suffered a bloodbath worse than the sharp tumble in US equities as risk aversion took hold of the markets. Many pin this on the surge in US bond yields on account of stronger Fed tightening expectations and upbeat US data. In turn, this could increase borrowing costs enough to dampen consumer and business spending, thereby weakening demand for riskier assets.
Note that bitcoin and its peers have been on somewhat shaky footing as the IMF warned about cybersecurity threats and how these relate to cryptocurrencies, as well as the role of regulation. However, it’s also worth noting that the FSB assured that bitcoin does not pose a threat to stability, citing:
“Based on the available information, crypto-assets do not pose a material risk to global financial stability at this time. However, vigilant monitoring is needed in light of the speed of market developments.”
The post Bitcoin (BTC) Price Analysis: Fake Out and Sharp Drop appeared first on Ethereum World News.
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