2018-7-26 05:52 |
Bitcoin has formed lower highs and lower lows on its daily time frame to create a descending channel pattern. Bears appear to be waiting at the top of the channel around the $8,000 level, which lines up with the 61.8% Fibonacci retracement level.
This also coincides with the 200 SMA dynamic inflection point, which adds to its strength as a ceiling. A continuation of the downtrend from here could lead to a test of the channel bottom or the swing low around $5,800.
The 100 SMA is below the longer-term 200 SMA to confirm that the path of least resistance is to the downside. In other words, the downtrend is more likely to resume than to reverse.
RSI is also indicating overbought conditions and turning lower could bring more selling pressure in. Similarly stochastic is in the overbought area to signal that buyers are feeling exhausted and ready to let sellers take over.
Still, a break past these resistance levels could be enough to confirm that bulls have the upper hand and could push bitcoin further north. The next upside target from there could be at the swing high near the $10,000 major psychological level.
Bitcoin has had a good run for the past few days, buoyed by the pickup in institutional interest and a large degree of FOMO among market participants. Traders have also welcomed regulatory updates positively, seeing this as a chance to increase security in the industry.
However, catalysts propping price further up appear to be running out and the attention has shifted back to stocks and commodities thanks to easing trade tensions. US President Trump and EC President Juncker recently made a deal to hold off further tariffs while trade negotiations are ongoing, leading to a huge relief rally in traditional markets.
Traders might also be booking profits at current levels as this is an area of interest after all. It’s not surprising to see market watchers extra cautious about locking gains quickly at key levels for fear of another sharp drop happening.
The post Bitcoin (BTC) Price Analysis: Bears Defending Area of Interest appeared first on Ethereum World News.
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