Bitcoin may be in route to a long-term correction rally considering the current price action.
BTC is testing the highest Fib retracement level on the downtrend correction rally. However, the bears are putting up a good defense. Bitcoin may start swinging low again if it drops below the support level of $9,700.
Price Analysis for Bitcoin
Considering the 4-hour chart, the 200 long term SMA is now below the 100 SMA, but the path to resistance is upward. Also, the 100 SMA is holding a dynamic support. If BTC can break below its current level, the bulls may be able to pull their weight at the 200 short-term moving average dynamic inflection point.
There is a signal of a bullish pressure as stochastic is beginning to pull away from the oversold region. The RSI has given room to fall so that sellers can remain in the game longer. Bitcoin may get into a downward correction rally if it moves below the 38.2 percent Fib as well as the 200 SMA. The price of Bitcoin will fall as low as $6,500.
Analysts believe that Warren Buffet’s negative comments to investors about Bitcoin may have contributed to the fall in price. His comments came even after Bitcoin showed its strength as a cryptocurrency on several occasions.
Also, Trump’s announcement about quitting the Iran deal also affected the price of Bitcoin as it reduced the interest people have in Bitcoin.
Reports, earlier in the week was the Bitcoin Futures launch was responsible for the December crash in 2017. This gave pessimists a room to enter the market and increase the selling pressure.
Is There Any Hope for Bitcoin?
While it looks like it’s all bad news for Bitcoin, there have been reports that ICE, an NYSE patent company, is making arrangements to launch an exchange that will give traders the opportunity to swap contracts and get their hands on Bitcoins within 24 hours.
Hopefully, the launch may help Bitcoin shake off the bears.