What a terrible week it has been for Bitcoin bulls who were trying to maintain the momentum and the price was tightly consolidated near the $8800 range as we mentioned in our previous analysis. Two consecutive sharp declines turned the market frenzy and high volumes of panic selling are clearly visible in the chart above. The prices broke the $8000 support nastily and still, the market doesn’t know who to blame it on— China or someone else. The total market cap dropped from $225 Billion to $196 Billion (~30 billion) in this timespan. The market is trying to undergo a price correction but is still traveling below $7400 mark. The momentum was heavily bearish near 21–23 November as the chart shows.
2 days ago, after struggling to recover above the $8,000 level and the 100 hourly simple moving average, there was a sharp decline. The price went down around 6% and it broke many supports near $7,800 and $7,600. Finally, the price tested the first major bearish target was $7,400 and a new monthly low was formed near $7,402. The price started correcting above the $7,500 level but faced another hammering from the top and fell near the support of $7000. In this time, it traded above the 23.6% Fib retracement level of the recent drop from the $8,107 high to $7,402 low but didn’t stay there for too long. This hammering took the prices below $6,900 and a new multi-month low was formed near the $6,776 level. The prices yesterday traded above the 23.6% Fib retracement level of the last decline from the $8,213 high to $6,776 low
The new resistance is installed at a $7400 level. Additionally, there is another breakdown pattern forming with support near $7,240 on the 4-hours chart of the BTC/USD pair. In the downside, there is another support forming at $6800 if it breaks the $7000 level. The market has made a collective stance that the prices will go as down as $6500. On the upside, the price must break the triangle resistance and $7,400. Besides, the 50% Fib retracement level of the last decline from the $8,220 high to $6,700 low is near the $7,500 level. Looking at the chart above, bitcoin price possibly may undergo another breakdown below the $7,200 and $7,000 support levels. Conversely, a close above $7,550 is needed for a correction towards the $8,000 level in the coming days.
The RSI is still recovering but is currently well below 40 level in 4-hour charts. The momentum is towards the bullish side as the corrections are trying to take the prices higher. MACD is showing bullish signs but it clearly shows the bullish upturn is still very slow and steady. The fundamentals are still intact but other than blaming it on China, the sentiment of the market was full of fear and panic. Massive dumps of Bitcoin selling was seen in the exchanges’ orderbooks. Sell orders were flooding bulk for not just Bitcoin, but for 95% of the top 100 cryptocurrencies trading in the market.
Among the top 10 cryptocurrencies, Ethereum (ETH), Litecoin (LTC), EOS and Binance Coin (BNB) are all down more than 12%, whereas Bitcoin (BTC) and XRP are down 15% and 12.3% respectively. The downside bias remains intact, despite the several recovery attempts, as the coin is set to book about 19% loss on a weekly basis. At this time, ETC/USD exchanges hands around 151.32, losing nearly 4% over the last 24 hours. Ripple (XRP/USD) quickly reversed from daily lows of 0.2264, but the bounce now appears limited in absence of weekend love for the digital assets. The recovery seen earlier on the day died down and the rates slipped back below the 0.2300 level.