Bitcoin Market Gets Choppy as Bears Push Back — Price Analysis

  • LTF (Low timeframe) trend: Down
  • MTF trend: A downtrend seems likely now
  • HTF trend: Strong uptrend remains intact

Yesterday, it looked as if Bitcoin (BTC) was set to continue its MTF uptrend for a while longer after a vigorous defense of a clear trendline and some other key technical levels. But last night, we saw selling that completely reversed that thesis. A more extended correction, retracement, or consolidation has become more likely in the face of such heavy selling.

On the 4-hour chart, we see that failure to immediately get above the $10,200 level presented enough of an opportunity for bears to dump the leading crypto down below the same trendline that had been defended barely a day before.

Rejected at 10.2kBTC chart by TradingView

Bitcoin blew through its first support level immediately, though it has since been bought up back above that zone. But with the (red) trendline now so definitely broken, we must now expect something like another leg down and deeper testing of key levels.

Moving to the daily chart, we see a daily candle that has completely reversed what seemed yesterday to be important gains: yesterday’s bullish engulfing candle was completely negated by the next day’s bearish engulfing candle on significant volume, and the 21 EMA has been lost. With momentum turning clearly down, we can imagine a test of the 55 EMA likely.

The scope of a longer retracementBTC chart by TradingView

On the subject of a longer retracement, we see a nexus of supports just under Bitcoin’s current price, above all surrounding the $9,070 level. The entire blue zone is significant historical support from multiple periods in 2019. The .382 Fibonacci zone also lies directly in the middle of this zone; and given the very strong HTF bull trend, there is a good chance that a Bitcoin retracement will hold at this shallow level.

An MTF downtrend now seems likely, unless some seriously volatile price action pours in – and fast – to once more reverse Bitcoin’s trajectory. We must remind ourselves that, far from being damaging to the HTF uptrend, it is probably the best thing for it: building an organic base will lead to healthier surges later in 2020.

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

Featured Image Credit: Photo via Pixabay.com