It seems that the Bitcoin price is now at the mercy of the bears, because bulls seem to have lost all control. In my yesterday’s analysis, I mentioned that the cryptocurrency has been violating crucial support levels, which makes it a perfect sell-on-rise candidate for a target of $230.
In the past 24 hours, the digital currency is little changed from $246.88 to the current $245.27. However, it was not without its fair share of volatility as the price slumped 4% intraday to a low of $236 before quickly pairing the losses. I expect volatility to remain an integral part of the upcoming trading sessions as well.
Image: https://www.tradingview.com/x/jtfGOMpZ/
Here I have analyzed the 240-minute BTC/USD price chart using technical indicators and Fibonacci retracements to put forth important support and resistance levels.
Price Chart – Until yesterday, the market was respecting the medium-term support level of $246. Technically, a breached support becomes the new resistance. Hence, $246 is now acting as the new resistance (marked in the price chart above) and the price has been unable to jump it after falling to $236.
Fibonacci Retracement – The implementation of Fibonacci retracement on the Bitcoin rally which started in February and petered out in mid-March reveals that the 76.4% retracement level is at $230. A 76.4% retracement level is an extremely strong support level.
Moving Average Convergence Divergence – The MACD and the Signal Line are still in the negative region with values of -5.3098 and -5.3860, respectively. But owing to the consolidation, the Histogram value is a tad positive at 0.0762.
Relative Strength Index – The RSI value of 38.8246 also fails to inspire any confidence among the short-term bulls.
It must be remembered that the Bitcoin price has fallen from roughly $295 to $240 in a matter of 10 days. Hence, future trades (essentially short trades) must be initiated after carefully weighing the risks and rewards. The trend is still Bearish!
