Since mid-summer, the market and analysts have been wondering if Bitcoin’s (BTC) retrace from $14,000 local highs was the retrace; as in, when would it return to a full uptrend? $9,000 was reached on the downside, but with Bitcoin threatening again to break down through $10,000, we may soon be back considering the retrace question.
Starting with the 4-hour chart, we see that BTC has been trending down of late, in the local market structure. An inability to even make it above the 55 exponential moving average (EMA) seems to be kicking the leading crypto down to its last line of defense at $10,000.
A volume break on this timeframe and exchange (Bitstamp) may be the start of a selloff. The uptrending blue band represents an uptrend with resonance from all the way back in February, and it is now perfectly confluent with the key $10,000 mark. Repeated retests of a level often result in their failure.
Looking at the 12-hour indicators, we see a worrying condition in the MACD, which is not rebounding up on this cycle, but rather trending sideways in negative territory. The RSI is consolidating on the low side of its range.
What we take away from this is a picture of consolidation, erring to the downside. Indeed, as we have discussed here recently, Bitcoin has been consolidating between about $10-11,000 for the past month, and it is anyone’s guess whether a break up or down is in the works.
A daily chart gives us the full picture of a moment of decision. Namely, will Bitcoin hold this symmetrical triangle consolidation pattern - riding the February uptrend - or will it break to the bottom of a descending channel pattern that it also seems to have respected?
This channel bottoms out near $8,000. If we lose $10,000 here, we could head down to this often considered retrace target. If that happens, the grand uptrend that Bitcoin has started putting down during 2019 would be tested. Indeed, at time of writing it looks likely that $10,000 will be lost - but this is Bitcoin we’re talking about, and 2019 has already been filled with moments of dramatic buy support flooding in at the 11th hour.
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