Following the announcement of the final set of Bitcoin regulations by outgoing New York regulator Benjamin Lawsky, Bitcoin did make an attempt to head higher. However, the rise stopped near the earlier mentioned stop-loss level of $227. The cryptocurrency has since trimmed the gains and is currently trading flat at $225.20.
Technically analyzing the 240-minute BTC/USD price chart above, it can be said with confidence that unless buyers decide to get back into action mode, Bitcoin looks all set for cheaper valuations.
Bitcoin Chart Structure – Bitcoin continues to face stiff resistance from the May-low. Post hitting the low of $220.65 in June, the cryptocurrency has been trying to create a higher-low, higher-top structure (check the chart above), and now to maintain that trend, the price level of $222.50 must not be breached.
Fibonacci Retracement – Technically, two Fibonacci retracement levels – 61.8% and 76.4% – are acting as the upper and the lower limits of the Bitcoin price.
Moving Average Convergence Divergence – The MACD indicator is paring the losses with Signal Line. Both the values are edging up; the latest MACD reading is -1.6635 while that of Signal Line is -2.2324. The Histogram shows only minor variations since yesterday with a value of 0.5689.
Momentum – Even as the gains were erased, the Momentum indicator did not drop into the negative territory. The indicator remains positive with a value of 2.3100.
Relative Strength Index – The RSI indicator shows a jump in the reading as well; from yesterday’s 39.7909 to the current 44.2916.
In my previous analysis, I had advised that Bitcoin be shorted by keeping a stop-loss above $227; I still maintain that. The underlying momentum and strength is still not strong enough to force the bears’ hand. Expect some high action moves by the end of this week. Create trading positions keeping the risk-appetite in mind.