Bitcoin is thriving
The leading cryptocurrency is going through a very volatile period. In fact, in the past few hours, BTC suddenly dropped by 4%, then regained that loss and eventually plummeted 3.5%. This significant price action takes place within 7 hours as can be seen on Bitcoin's 5-minute chart.
Technically, there does not appear to be any explanation given in such a low time frame due to the high volatility. However, a higher time frame may show a better picture.
For example, on Bitcoin's 1-day chart, a Spinning Tops candlestick pattern seems to be developing. This technical model tends to form when there is indecision among market participants about the future direction of an asset. Spinning tops show that neither bulls nor bears can gain control of price action.
However, the current candle pattern is also a green primary candle based on the TD Sequential indicator. This type of candlestick pattern represents a sell signal – which can be followed by 1 to 4 correction candles or the beginning of a downtrend.
When a Spinning Tops candle and a blue main candlestick pattern are combined – as in this case, the odds for a retreat increase exponentially.
Increasing selling pressure behind Bitcoin could drag its price down. BTC can then find support around the 78.6% Fibonacci retracement level. A break below this barrier can trigger a stronger decline towards the 61.8% and 50% Fibonacci retracement levels. These support areas are currently at $ 8,900 and $ 8,500 respectively.
Hope for a step further?
Despite the bearish outlook, it's nothing worth mentioning as the $ 10,480 resistance is key to Bitcoin's trend. In fact, this level may even be the catalyst for the next major development.
A bullish impulse helps BTC close the candle above this price level which will bring it to its highest peak since June 2019. The upside momentum may be supported by the increase of buying orders. Investors can enter the FOMO phase because of the importance of this milestone.
On the upside, Bitcoin will face significant resistances at around $ 11,500, $ 12,100, and $ 13,000.
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According to CryptoSlate
Translated by ToiYeuBitcoin