Bitcoin Price Key Highlights
- Bitcoin price was previously trading inside an ascending channel before making a break lower, indicating a reversal from the short-term uptrend.
- Price also broke below the nearby inflection points, which means that sellers are gaining traction.
- For now, technical indicators are suggesting that the uptrend might still carry on but that could change soon.
Bitcoin price made a downside break from its ascending channel pattern, signaling that a reversal is about to take place.
Technical Indicators Signals
The 100 SMA is still above the longer-term 200 SMA so the path of least resistance is to the upside. However, bitcoin price moved below these moving averages so a downward crossover could be imminent. If so, selling pressure could increase and take bitcoin down to the next area of interest.
Price is currently stalling at a former resistance level around $665, which might hold as support moving forward. Stochastic is indicating oversold conditions and is turning higher, suggesting a return in buying pressure.
If so, bitcoin price could pull up to the broken channel support at $670 before resuming its drop. Stronger bullish momentum could even lead to a climb back inside the rising channel and a continuation of the uptrend.
Market Events
The US dollar appears to have emerged as one of the stronger currencies these days, thanks to strong US fundamentals and the return in risk aversion. Speculations of additional easing from major central banks is also drawing stronger demand for the safe-haven US dollar. Also, strong earnings figures from top US firms continue to fuel the dollar’s gains against majority of its counterparts.
Apart from that, uncertainty in the global economy seems to be subsiding so traders might be letting go of their bitcoin holdings to pursue traditional assets like equities and currencies once more. Catalysts for today include the European Central Bank policy statement as their thoughts on the global economy could have a strong impact on market sentiment and therefore bitcoin price action.
Charts from SimpleFX