Bitcoin [BTC] Price Logs Short-Term Bullish Indicator after Closing Below 7-Month Low
Bitcoin records its lowest closing since May of this year as the price closed around $6610 on 17th December. While the recent swing low was around $6515, it lived only for a short time. Moreover, the current bear set-up seems to be holding the price below $6700.
The price of Bitcoin at 3: 30 hours UTC on 18th December 2019 is $6690.
Long liquidations of traders looking for a bounce reached around $113 million in the last two days. Traders attempted strongly to defend the $7000 and $6800 levels of support. However, the sell-off continued past it.
The funding rate on Bitcoin has flipped negative on the $200 break from $6800. BTC basis on Okex as well flipped negative early on 17th December 2019. The technical oscillators like MACD and CMF on the daily and weekly indicate bearish momentum.
The long term support to the price is around $6400. A break below that would could drive the price into the range before the bounce between $5000 and $5600.
Is a Relief Bounce Possible?
According to Tone Vays, a dead cat bounce is highly probable. According to sequential analysis, he points out that around the end of today we could expect a bounce. He mentions in his update,
In around 24 hours from now the 12-hour is on a 9, the 4-hour is on a 9. And the daily will be coming off its’ 9
The 9 reversal candle on the sequential is one of the most sought after trade set-ups.
However, if the bounce fails it would signal the continuation of the bears and the price could reach $5500 as a surprise to all the bulls.
Bitcoin also recorded a morning star on the 4-hours chart which is a bullish reversal signal as well. At press time, the close of the candle is 30 mins far.
The RSI on the daily and the four-hour is also looking for a reversal at critical junctures in the oversold area.
Last but not least, the bias of Bitcoin is still negative. Hence, a bounce would meet a lot of resistance before it can take on a long term bullish momentum. The possibility of another dead-cat bounce is probable too.
Do you think a reversal will continue or a bounce to $7000 is on the cards? Please share your views with us.
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