Your favorite crypto news blog

As Bitcoin Price Fails to Break Crucial Resistance; Breakdown Sentiment Looms

Bitcoin 2019/12/10 15:55 by Yashu Gola

The bitcoin price plunged on Tuesday after facing another strong rejection from a psychological resistance area.

The leading cryptocurrency established a new intraday low near $7,274, down 5.11 percent from the local high of $7,552.92. The move downhill reasserted the $7,500-7,600 range as a crucial wall standing before bulls.

The area has rejected bitcoin’s upside attempts on four occasions since Friday. With the selling pressure high, the price has no option but to either consolidate or retest lower levels for strong pullbacks.

The dropdown came after Bakkt announced the release of its monthly options and cash-settled bitcoin futures. It showed traders are completely sidelining the market-moving catalysts, especially the ones that attribute to the bitcoin adoption at institutional scales.

Bakkt, an Intercontinental Exchange-backed digital assets platform, promised to become a bridge between crypto and Wall Street. But with traders sidestepping its growth in the space, it appears bitcoin is establishing its interim bias purely based on technical factors.

That Redded Range

Bitcoin’s rejection of the purpled resistance range, as shown in the chart below, confirmed the cryptocurrency’s inclination to test the redded historical support area.

bitcoin, bitcoin price

Bulls are unable to close the price above the purpled area | Source: TradingView.com, Coinbase

As discussed in the previous coverage, the redded range behaved as support during bitcoin’s downtrend in 2018 – and resistance in 2019. More so, bitcoin is trending inside a descending parallel channel.

The growing selling pressure could prompt the price to test the Channel Support which – again – is dipped inside the redded range.

So it appears, bears can play bitcoin down towards the $6,000-6,500 area in medium-term, creating ample opportunities for short traders to make decent profits.

Meanwhile, a bounce-back from the redded area – or above, could have traders open long entries towards the purpled range, defined by $7,500-8,500.

1 Hour Chart (Featuring A Risky Bitcoin Trade)

The latest price action has also influenced bitcoin to break out from the Symmetrical Triangle discussed in the previous analysis. As of now, the price has established interim support near $7,272. At the same time, the $7,386 level is behaving as resistance.

bitcoin, bitcoin price

Symmetrical Triangle borns a breakdown during Tuesday trade | Source: TradingView.com, BitStamp

The range is decently spread to place open small intraday positions. For instance, a long entry towards $7,386 while maintaining a stop loss below support could yield decent returns.

Similarly, opening a short position towards $7,272 on a pullback from resistance while keeping a stop order opened near $7,400 looks attractive.

But, at the same time, traders with risk-appetite can consider a long position towards the Channel Resistance after treating the ‘DASHED’ ascending trendline as Channel Support.

The price has just bounced back from the unconfirmed support. At this point, a surprise jump in volume with a green candle formation on hourly charts could just be the signal to open a Long trade.

However, maintaining a stop loss below the DASHED trendline could be a decent risk management exercise to reduce losses (should the price moves in the downward direction).

[Disclaimer: The opinion expressed in this article are of the author and author only. Readers’ discretion is advised.]

The post As Bitcoin Price Fails to Break Crucial Resistance; Breakdown Sentiment Looms appeared first on NewsBTC.

0 Like(s)

You should also read...

Bitcoin 07/05/20 14:37 by Yashu Gola
Halving Won’t Save Bitcoin From Falling to $7.5K; Here’s Why
Bitcoin briefly closed above $6,400 for the second time in seven days. The cryptocurrency later pulled back by circa $400 amid profit-taking. It found support near $9,000, raising concerns about an ex...
Read More
Bitcoin 01/06/20 15:00 by Yashu Gola
Restored Falling Wedge Pattern Sees Bitcoin Rising above $11,500
It appears Bitcoin missed a medium-term upside target above $11,500 after undergoing a significant sell-off in March 2020. The major northward move had appeared out of a Falling Wedge breakout. Bitcoi...
Read More
Bitcoin 11/06/20 13:00 by Yashu Gola
A Bitcoin Crash Towards $8.8K Likely Before Price Breaks $10K; Here’s Why
Bitcoin failed at yet another attempt to break bullish above $10,000 on Wednesday. The cryptocurrency’s sharp pullback from the crucial resistance level has raised its possibilities of falling ...
Read More
Bitcoin 02/07/20 12:59 by Yashu Gola
Analyst Expects Bitcoin Above $9.5K in Near-Term as Risk-On Sentiment Improves
Bitcoin analyst Edward Morra sees price heading towards $9,575 in the coming sessions. The prediction surfaces after the cryptocurrency failed to close above its short-term resistance level near $9,2...
Read More
Bitcoin 23/07/20 13:03 by Yashu Gola
Bitcoin is About to Make a Move Towards $10K; Analyst Explains Why
Bitcoin’s recent jump above $9,500 has increased its probability of testing $10,000 in the coming sessions, according to an analyst. He also noted that traders would first target $9,785 as thei...
Read More