Working our way through what is for many a holiday week, Bitcoin (BTC) has again become slightly erratic after giving back most of the gains from its most recent (December 19-23 surge). There is some fighting to keep Bitcoin barely within the scope of that range, but things do not look especially auspicious.

Starting on the 4-hour, we see that Bitcoin has retraced almost all the way back down to the local December 19 bottom, through the entire Fibonacci retracement scale. We have seen some support come in at the very bottom, likely because of the common trading notion that a market structure is not completely canceled until its boundary is completely overtaken (in this case, $7,000 flat.

Not much left to goBTC chart by TradingView

Price has been quickly pushed back above the moving averages, and it has to stay here: losing these levels again would probably spell the death knell of this local market.

Moving to the daily, we see that this local action is couched within the potential for a reversal. Price has lately double-bottomed, and the RSI has diverged bullish from this price action signaling strength. Even if we see the current structure, described above, lost, holding this daily RSI trendline will preserve the chance at a long term reversal.

Plenty of RSI room leftBTC chart by TradingView

Volume peaks on this timeframe continues to consistently fall, suggesting a larger move coming sometime soon-ish. The histogram here is holding up pretty well, expanding bearish at a flat (not accelerating) rate.

Finally, on the weekly, we see a quite bearish picture holding out. Price is stuck under every main EMA, with not even a breach of – let alone close above – the 8 EMA. RSI continues to downtrend with lower highs and lows. The histogram looks less bad overall, with a divergence and some feeble bullish contraction. But this is hardly enough to throw back the overall bearish picture of a downtrend that refuses to die.

Those EMAs are all starting to point downBTC chart by TradingView

Ultimately, only on the shortest of timeframes do we see anything bullish. The potential for a medium timeframe reversal is still there, but that potential is now barely intact. Things certainly do not appear bullish in any way for Bitcoin now – but that does not mean it can’t rocket up at any moment, saved by phantom buying: it happens all the time.

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

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