The price failed to reach the $ 10,300 mark and plummeted $ 800 to $ 9,300 within 30 minutes before closing the candle at $ 9,600 (setting a 5.5% decline on the day). This is the largest reduction in the day since 11/21.
Bitcoin dropped 6% from 8,600 to $ 8,085 on November 21. Since then, the coin has had 44 days of closing the candle, but the decline is usually very modest during the day.
As the chart above shows, Bitcoin dropped nearly 3% in just 13 days, over a period of 4 and a half months. These figures are quite modest when compared to a jump from $ 6,850 to $ 10,500, the jump that triggered the market's uptrend this year.
As a result, yesterday's 5.5% plunge could be a positive rally for Bitcoin. This decline has been predicted when the gold cross took place (MA 200 and 50 days cross). A gold cross or a gold cross is often an indicator of lag and usually marks a temporary peak of the market.
When Bitcoin hit the $ 10,000 threshold again on Tuesday, it seemed like this move helped BTC to retest the $ 10,500 threshold. But as a result, last Wednesday was a trap for those who bought in above the $ 10,000 threshold.
However, the overall trend is still bullish if the critical support of $ 9,100 is sustained. At the time of writing, Bitcoin is priced at $ 9,620 on Bitstamp, while the global average threshold is $ 9,626.
Day candle chart
Bitcoin has formed a series of new highs and higher lows in the past 2 months. This bullish structure remains the same even though the market plummets to $ 9,500 and is only denied if the price falls below $ 9,075 (the bottom threshold of February 4).
However, the risk of slipping to $ 9,075 after the market plunged yesterday. A bearish engulfing candle formed and a new lower high formed at $ 10,300.
Therefore, the rally needs to be activated early to push the price beyond the 5-day MA at $ 9,800. Overcoming this short-term average price can help traders to be confident in the uptrend.
If the bulls break through Wednesday's peak of $ 10,300, the market will have a stronger confirmation.
4-hour candle chart
Bitcoin is still held in the downtrend channel, like the upper left candlestick pattern. Meanwhile, the head and shoulders pattern has gradually appeared in the graph on the right.
If the price falls below the neckline support of $ 9,675, the head and shoulders pattern will be confirmed and can bring the price back to $ 9,000.
If the price can hold an average of 200 candles at $ 9,400, the selling pressure could ease and a rebound could take place.
- Although the price dropped $ 800 on Wednesday, the overall trend of the Bitcoin price is still rising as the price is currently stable above $ 9,075.
- However, an engulfing candle yesterday dropped the market at risk of another plunge.
- A short-term jump to the $ 9,800 mark is needed so that the sell orders are no longer under too much pressure.
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