Robert Sluymer, a technical guru at Fundstrat Global Advisors, has recently revealed bitcoin’s technical outlook has significantly deteriorated after the cryptocurrency saw its price drop over $1,000 in about 24 hours.
Bitcoin’s drop came shortly after a mysterious whale moved over $100 million worth of BTC to crypto exchanges, and after reports falsely claimed Goldman Sachs was dropping its plan of launching a bitcoin trading desk in the near future. The firm’s CFO revealed these were false, as the company is still working on it.
In the last 24-hour period, the cryptocurrency dropped to a $6,190 low before climbing back to $6,390 at press time. It’s still down by 1.1% in said period, according to CryptoCompare data.
The drop saw its price fall below its 100-day moving average, an important momentum indicator. The cryptocurrency has recently added about $200 in only 10 minutes, which helped it get above its 50-day moving average.
Before bitcoin’s price plummeted Sluymer revealed through a note the next one or two weeks were critical for BTC, as the $6,600 and $6,800 were a crucial support. Once broken, they could see bitcoin retest last month’s lows under $6,000.
As CryptoGlobe covered, two prominent traders have recently argued bitcoin will bottom out at $6,000 because of its mining costs. Speaking to MarketWatch Sluymer added that since bitcoin’s “very damaging drop,” its technical indicators turned bearish as “we remain with lower lows and lower highs.”
The analyst further noted that outside of day trading, he doesn’t see a reason for traders to enter long positions, and noted those who are indeed day trading have “to have a tight stop.” The stop-loss order, or stop, is a standing order that’ll help traders avoid huge losses as it’s triggered if the crypto hits a certain price.
While bitcoin is now down over 50% year-to-date and has dropped over 17% since the beginning of last month, it’s still doing better than various cryptocurrencies, including ether. Per Sluymer, the $195-$200 region is a key support for the second-largest cryptocurrency - one that’s struggling.
Given relative performance vs BTC continues to lead to the downside we view the break below $250 as a legitimate breakdown with the next support at $195-$200.
Per CryptoCompare data ether has dropped to a $185 low this week, before its price started to recover. It’s currently trading at $201, after falling over 8% in the last 24-hour period. Its drop came shortly after Opera upgraded its built-in ETH wallet, and F2Pool revealed it’s still able to profitably mine the cryptocurrency.