- Bitcoin price was crushed today against the US Dollar and looks set for more declines in the near term.
- There was a major bullish trend line formed on the 4-hours chart (data feed from Bitstamp) of BTC/USD, which was broken during the downside move.
- There was also a bearish flag pattern on the same chart, which was cleared to open the doors for more losses.
Bitcoin price failed to sustain the bullish bias against the US Dollar and moved down. Is a test of $620 in BTC/USD possible in the short term?
Bitcoin Price Break?
Bitcoin price after a ride towards the $680 level against the US Dollar failed and started moving down. This past week was mostly ranging moves for the BTC/USD pair. However, today the price found a lot of sellers and sharply moved down. During the downside move, the price broke a couple of important support levels, which opened the doors for more losses in the near term.
First, a major bullish trend line formed on the 4-hours chart (data feed from Bitstamp) of BTC/USD was cleared. Second, there was also a bearish flag pattern cleared, signaling a start of a downside ride. Once there was a break of the flag pattern, the price immediately went down from $655 to $630. Moreover, it also broke the 50% Fib retracement level of the last wave from the $606 low to $682 high.
The most important point is the fact that the price struggled to close above the 100 simple moving average (H4 chart), which means it may move down further. I think selling rallies may be considered as long as the price is below $660.
Looking at the technical indicators:
4-hours MACD – The MACD is now in the bearish slope, which is a string negative sign for BTC.
4-hours RSI (Relative Strength Index) – The RSI moved down sharply, signaling seller’s strength.
Major Support Level – $630
Major Resistance Level – $660
Charts courtesy – SimpleFX