Bitcoin Technical Analysis: Bitcoin Drops Over 3.53% as Bear Continuous
The technical analysis of Bitcoin indicates a continuation of the declining trend as the price struggles to cross above the 200-day SMA due to selling pressure.
The week has been a roller coaster for most of the crypto markets. Bitcoin (BTC) also saw a dramatic drop to its two-year low of $15,555 which it hit last time in November 2020 in the backdrop of the COVID-19 crisis, registering a drop of 21.59% in the last 7 days.
The current crypto crash is coupled with a number of events including liquidity crises in US-based crypto exchange FTX and Binance-FTX failed acquisition deal.
Although the market bounced back on Thursday, with BTC trading above $17,000, it could not maintain the bullish reversal on Friday and Saturday and dropped down below the crucial support of $16,900.
Key Points
Source Tradingview
Bitcoin Technical Analysis
As Bitcoin does not show signs of a bullish reversal on the daily chart, the situation remains bearish. If BTC does not make its way back it may make support at $13,880. And if BTC bounces above the $18,000 resistance level, it would be put to test at $21,000. The 3.86% drop in market cap which stands at $321.92 billion reflects the buying pressure in the BTC market as prices remain relatively volatile. In the last 24 hours, BTC dropped more than 3.53% to make support near $15,722. If the prices drop below $16,000 again there are high chances of the breakout of present support. Trading at $16,718.39 at press time BTC touched the daily low of $16,351.42.
Technical Indicators
Sharply diving below the 50% boundary from the overbought zone, RSI makes a bearish divergence moving below the 14-day SMA indicating a bearish breakout for buyers. On a bearish histogram, MACD and signal line makes a bearish crossover, maintaining a downtrend despite recent symptoms of recovery.
Therefore, the Bitcoin technical analysis shows BTC has failed to overpower the current bearish cycle, however, there is a possibility of a bullish reversal if BTC crosses the $18,000 resistance level.