Analysis Bitcoin Technical

Bitcoin Price Technical Analysis for 01/23/2018 – How Low Can It Go?

Sarah Jenn | January 23, 2018 | 2:51 am
bitcoin
Analysis

Bitcoin Price Technical Analysis for 01/23/2018 – How Low Can It Go?

Sarah Jenn | January 23, 2018 | 2:51 am

Bitcoin Price Key Highlights

  • Bitcoin price continues to trend lower and has barely found support after the previous retest of a broken short-term trend line.
  • Price is still inside its longer-term descending channel and looks ready for another move towards support.
  • Applying the Fib extension tool on the latest correction shows that the 38.2% level is holding but that price could still head to the lower levels next.

Bitcoin price continued its slump and may be setting its sights on the lower Fib extension levels.

Technical Indicators Signals

The 100 SMA is below the longer-term 200 SMA so the path of least resistance is to the downside. In other words, the selloff is more likely to continue than to reverse.

These moving averages are close to the channel resistance, adding an extra upside barrier in the event of a test. If selling pressure persists, bitcoin price could break through the 38.2% level then move on to the 50% extension at $9148.52.

The next support is at the 61.8% extension at the bottom of the channel around $8200 then the 76.4% extension is located at $7066.67. Stronger selling momentum could lead to move all the way down to the full extension at $5205.62.

Stochastic is pulling up from the oversold region, though, indicating that buyers could take over price action and probably lead to a move up to the area of interest at $13,000-14,000. RSI, on the other hand, is still pointing down to signal that sellers are in control.

Market Factors

The dollar drew some support from the passage of the funding bill in Congress that effectively ends the government shutdown. Equities and bond yields also ticked higher, drawing investors back to the U.S. markets again.

Meanwhile, bitcoin price tumbled once more as South Korean regulators took more steps to remove anonymity in transactions. The Vice Chairman of the Financial Services Commission real names on a virtual coin exchange wallet and bank account must be the same for a user to be able to make deposits starting January 30.

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