Bitcoin made a small recovery today after two days of constant drop down to the $7,500 level. However, according to the technical strategist at Fundstrat Global Advisors, Rob Sluymer it is a moment of truth for bitcoin as the 200-DMA indicates a pullback that last time in May led to 40% drop in BTC price.
Bitcoin [BTC] sees flecks of green
For the past two days, Bitcoin (BTC) has been constantly going down. In effect, it fell down to $7,500 level. The week started on a good note with Bitcoin at $8,250, only to continuously slipping.
Bitcoin has fallen about 9 percent from Bitcoin at its highest on Monday at $8,261 to today’s $7,600. With a market cap of approximately $130 billion, the daily trading volume of Bitcoin also experienced a drop as it reached about $4.2 billion from $5 billion.
Today, Bitcoin saw a small recovery as it moved upwards and above $7,500 price level. In the past few hours, bitcoin registered 1 to 2 percent of gain only to lose to the bulls but managing to remain barely in the green.
If the prices continue to rise, it will find resistance at $7,800. From here, it will hit its bullish goal of $8,000.
The entire crypto market is in the correction that is aiding in maintaining the dominance level of Bitcoin to over 48 percent. A majority of the altcoins are in the red, especially the top 10 except for Bitcoin.
“Moment of truth” for Bitcoin
The market is pretty dull which will further test another low in the coming days as per Rob Sluymer, technical strategist at Fundstrat Global Advisors.
According to him, from a technical point of view, Bitcoin rally has been pulled to a stop by the 200-DMA. This is presenting a long term resistance to the coin as stated by him:
“In the very short-term, BTC is likely at a pullback/pause point at resistance level coinciding with a 61.8% retracement of the May-June downtrend just below the May 20 highs and near the declining 200-DMA.”
If we take a look at the last time, in May, Bitcoin made a pullback from the 200-DMA, it lost about 40 percent of its value. Coming to the end of June, it dropped down to $5,800 level. Just like last time, this time as well, the 200-day moving average is forming resistance for Bitcoin.
According to Sluymer, this is a “moment of truth” for bitcoin as it trades near the $7,400 support level. So, now the wait and watch come to see if Bitcoin will make an upward movement or take a nosedive.