After trading in a range of $ 6,450 - $ 6,850 for the past eight days, the Bitcoin price has finally made a bigger move, this time falling, as the digital assets plunged nearly 10% to a daily low at $ 6,068.
The move somewhat reflects the performance of traditional markets, also closing daily in the red. The Dow closed down 915 points, the S&P 500 retreated 3.37% and the Nasdaq fell 3.79%.
A break below $ 6,550 has pulled Bitcoin price below the ascending trendline and supported $ 6,450. Traders predicted that a drastic change occurred after the price traded sideways with decreasing volume for most of the week, nor was it able to push above $ 6,850 and turn the resistance level into support.
BTCT USD 4 hour chart. Source: TradingView
At the time of writing the price is above the 12-MA (daily time frame) and traders are trying to reclaim the support of $ 6,200. If this attempt fails, it can retest $ 5,800 and $ 5,350.
In the short term, Bitcoin price first needs to recover $ 6,200 then push above the high volume VPVR node at $ 6,335 to regain the $ 6,500 range.
Earlier this week, trader filbfllb commented that the possibility of Bitcoin price reaching $ 10,000 before May is impossible.
“Bitcoin is trading at the basic decision point at $ 6,800. Previously this level acted as a support but has now turned into resistance and is the top of a high volume node separated by the cross-resistance trend line, which appeared in mid-2019. ”
According to filbfilb, the Bitcoin price is approaching a critical time and:
“If the bulls fail to reclaim the $ 6,800 level, then the 200-week MA is below $ 5,500 on a high-volume node, previously bought in the last attempt to break $ 6,800. If the bull finds a foothold again, cross support will be found at $ 6,250 ”.
Bitcoin price risks falling to $ 4800
After a nearly 10% drop, BTC is currently showing three deeper pullback signs with much lower support levels.
Those three indicators include: a significant drop in the volume of the CME bitcoin futures contract, spot volume also dropped significantly and prices broke below the strong support of $ 6,400.
The bitcoin price's decline overnight has resulted in the rejection of two major resistance levels: $ 6,900 and $ 6,400.
Before a minor correction, technical analyst Cred said that the price of Bitcoin is testing its weekly resistance. Historically, when Bitcoin prices tested critical resistance with low volumes and demand did not exist, it often responded with a large decline.
“Retesting weekly resistance. The daily market structure is increasing but i) weekly closing is decreasing; and ii) had no daily close above the resistance ($ 6900). My trend is down until at least daily close above $ 6900 but if resistance breaks, the price will probably pullback. ”
Retesting weekly resistance.
Daily market structure is bullish but i) weekly close was bearish; and ii) no daily close above resistance ($ 6900) yet.
My bias is bearish until at least> $ 6900 (daily) but if resistance breaks a teleport is more likely than a pullback. pic.twitter.com/SGUxo8g6Ux
- Cred (@CryptoCred) March 27, 2020
The recent decline shows that Bitcoin price has completely declined $ 6,900 and is on its way to close the weekly candle with the rejection of two key levels.
Bitcoin's bleak price trends that appear in tandem with a 90% decline in CME Bitcoin Futures market volume could trigger high selling pressure in the market to stop Bitcoin prices.
According to data from Skew, the total daily volume of the CME bitcoin futures market has dropped from $ 595 million in mid-March to $ 101 million, down more than 83% in March.
Spot trading shows a similar trend, possibly due to the sudden drop in Bitcoin price on March 12 to $ 3,600 causing FOMO among investors in the cryptocurrency market.
The lack of orders and buying volume at a time in which miners can sell more BTC to cover short-term costs only adds to selling pressure in the market.
According to a trader, the order-book of Bitcoin futures futures on BitMEX shows a large imbalance between buyers and sellers, with sellers clearly controlling the market.
Decently big imbalances between bid and ask side on bitmex… 7k would be a tough nut to crack pic.twitter.com/0NKKNMq0Gc
- SalsaTekila (JUL) (@SalsaTekila) March 26, 2020
For that reason, traders have said that the probability of Bitcoin surpassing $ 6,900 to target the low area of $ 7,000 is very low.
You can see the price of Bitcoin here.
Disclaimer: This is not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.
According to AZCoin News
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