In my previous Bitcoin analysis, I had mentioned the possibility of the price touching $230 in the near term, and as can be seen, the virtual currency cracked roughly 1.5 percent to $231.44. However, bulls have managed to pare most of the losses, bringing the price back up to $234.
Image: https://www.tradingview.com/x/0U4yd2UC/
With price slipping further, it only becomes necessary to revise the technical levels. An analysis of the 240-minute BTC/USD price chart has been carried out for the aforementioned purpose.
Bitcoin Chart Structure – The chart above represents the slow, downward movement of the virtual currency. With steady decline, Bitcoin has neared the previous bottom of $229. Plunging below this low can exacerbate the situation for the bulls. However, the market may not break this level in a hurry!
Bollinger Bands – The 20-4h simple moving average has been capping the upside potential of the cryptocurrency. The latest value of the SMA is $235.75.
Moving Average Convergence Divergence – The MACD indicator has crossed the Signal Line on the downside, thereby dragging the Histogram reading in the negative territory as well. This is a clear indication of the pessimism surrounding the cryptocurrency. The recent values of MACD, Signal Line and Histogram are -0.9571, -0.7436 and -0.2136 respectively.
Relative Strength Index – Interestingly, the strength reading remains fairly steady in the face of sluggishness. After a brief dive into the oversold region, the 14-4h RSI indicator reads a value of 37.3087; yesterday’s observation was 37.2687.
Conclusion
Bitcoin looks a tad resilient to further erosion in the market cap. Hence, those who are holding their short positions must revise their stop-loss level from $240 to $236. Market participants may also add light long positions if the price stoops to $229 while any rise up to $236 should be used to create fresh bearish trades. The consolidation may not prolong given the price’s close proximity to the important technical level, so staying alert would be well advised.
