If your trading alerts are blowing up, it’s probably clear to you by now that Bitcoin (BTC) has taken a very major move down in the past day – far beyond, even, what had already been major moves during the week. The leading crypto is now careening to the downside, and a long term downtrend looks increasingly likely as we head toward 2020.

We start with a 4-hour chart, and see the slice through the local market structure limit at $7,300. This limit was set at the end of last month, before Bitcoin surged up in what now looks like a large bull trap.

No end in sightBTC chart by TradingView

We can see that volume has built up on every dump in the last few days, and on this medium term timeframe there is no divergence in RSI strength. The RSI level itself has got down to levels rarely ever seen for Bitcoin; the last one being almost exactly one year ago, when Bitcoin capitulated down toward $3k. In the short term, we could well see a relief bounce to reset the RSI a little; but it will likely be very temporary upside.

Looking on the daily chart, we see that all possible support levels in this region have already been lost. Based on this, we can probably expect that Bitcoin will indeed head lower in the coming days, searching for more solid support on the way down. Alternatively, there is probably a slim chance of retaking and closing above $7,300; but here, it probably would not to much good as the chance for a higher low on the daily RSI is already gone.

rektBTC chart by TradingView

Finally, moving to a weekly chart, we see that Bitcoin has by now already re-entered critical price territory from 2018, namely the start of the bear market’s main resistance zone at $7k. We can also see that the RSI is now dipping below the 2018 capitulation level. There are still a couple of days left for this to be salvaged; but at this point, we should cautiously accept a close below this level.

Long term indicators are turning very bearishBTC chart by TradingView

The histogram adds to the bearish narrative, as it is pointing South with increasing velocity. Again, there are a couple of days for this to improve, but buildup of downside momentum here seems quite likely, implying an extension of the downtrend that looked to be ending late last month.

Based on the technicals, it would be nowhere surprising for an extended downtrend to play out. The one counter-argument here is that volume on this breakdown – relative to past breakdowns – has not been spectacular. This possibly suggests a lack of buyers rather than a legion of sellers. Just the same, we should settle in for winter.

The views and opinions expressed here do not reflect those of CryptoGlobe.com and do not constitute financial advice. Always do your own research.

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