- Bitcoin risks sliding below $5,200 key level maid growing bearish momentum across the market.
- A correction to $5,000 will be a necessary evil that is likely to create more demand.
Bitcoin is sitting above the 61.8% Fib retracement level between the last upswing at $5,352.05 and a downswing of $3,868.19 following the last week’s surge above $5,000. Bitcoin surprise move above the critical $5,200 before coming to halt at $5,352.05. For at least a week now the buyers have been in control maintaining the uptrend above the trendline.
Bitcoin failed to sustain the trend above the high formed at $5,352.05. A retracement from the highs was supported at the 61.8% Fib level allowing bulls to regain control. Another breakout made it above $5,200 but turned bearish on touching $5,300. BTC/USD has since the opening session today been trending lower towards $5,200 short-term support.
According to the indicators on the 4-hour chart, the largest asset is on the verge of a flash drop that could spark declines below $5,000. The stochastic is heading south at 55 after it was retracted from the levels above 80.00.
Key Technical Indicators:
Support 1: $5,200
Support 2: $5,200
Support 3: 61.8% Fib level close to $4,750
100 SMA 4-hour: $4,500
200 SMA 4-hour: $4,222.23 (coincides with the 38.2% Fib level).
Resistance 1: $5,300
Resistance 2: $5,352.05.
Stochastic: 55.00 (trending lower)
Prediction: If Bitcoin price slides below the trendline support, a flash drop to areas around $5,000 will follow. At this level, fresh demand will be created as buyers find better buying positions. BTC/USD will spike up again and this time it will be unstoppable towards $5,400.
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John is a talented writer with over two years of experience actively contributing to the cryptocurrency industry by providing credible, interesting and easy to read the content. His main focus is on cryptocurrency price analysis and industry news coverage. Lets follow him on Twitter at @jjisige