2019-1-4 05:39 |
Bitcoin is still stuck in its symmetrical triangle consolidation pattern after getting rejected on the test of resistance. Price is nearing the bottom of the triangle around the $3,900 mark and a break lower could signal that bears have gotten the upper hand.
The 100 SMA is still above the longer-term 200 SMA to suggest that the path of least resistance is to the upside or that support is more likely to hold than to break. A dip below the triangle bottom could still find a floor at the 200 SMA dynamic inflection point at $3,800 which might be the line in the sand for a potential bounce.
A break below this could send bitcoin down by the same height as the chart formation, which spans $3,200 to around $4,400. Similarly a break past the triangle top around $4,100 could lead to a rally of the same size.
RSI is on the move down so bitcoin might follow suit while sellers are in control. Stochastic is also heading lower to signal the presence of bearish momentum. The oscillators have some room to cover before hitting oversold levels, which suggests that sellers could stay on top of the game for much longer.
Bitcoin was off to a good start for the year as optimism may have been in play. A huge part of this was likely due to expectations of institutional investments kicking in and lifting volumes in the months ahead. However, traders would like to see evidence of this actually taking place before piling on long positions and holding on to those much longer.
For now, it looks like traders are still being their usual cautious selves and booking profits quickly off any bounces. The presence of risk aversion in financial markets as traders are still reacting to higher US borrowing costs against the backdrop of trade tensions and the government shutdown is also weighing on demand for crypto.
The post Bitcoin (BTC) Price Analysis: Back to Support, Bulls Overpowered? appeared first on Ethereum World News.
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