The value of Bitcoin (BTC) began Monday with a little price correction to compensate for the massive losses on Sunday. However, digital currency investors should not get their hopes up, as the digital currency still faces a stiff hurdle on the upside. Bitcoin (BTC) established its intraday high at $3,860, up by about one percent for a period of twenty-four hours.
On Sunday, in a time frame of 9 hours, Bitcoin (BTC) lost about 10 percent of its value – a massive decline which appears to be a dump. The digital currency started correcting higher after testing the low of $3,721. At that same trading period, the BTC market recorded lower intraday volatility and volume. This means that the bearish momentum is still in play.
Bitcoin (BTC) Encounters Strong Resistance at the $4,200 Level
In late November last year, the value of Bitcoin (BTC) declined below its strong support at the $6k level. Bitcoin (BTC) tried its first upward correction on the 23rd of November when it surged from $3,453 to $4,419. Nevertheless, the digital currency failed to extend its gains whenever it came close to a specific hurdle point.
Since Bitcoin (BTC) embarked on its first upward attempt, the digital currency has tried to break over the major resistance zone on five different occasions. At the same time, the 50-Day moving average of the coin has also capped bullish attempts. Recently, the digital currency surged over that moving average to create an interim bullish bias.
However, the BTC/USD pair met the hurdle point that altered the extension of the rally. Upon the bearish divergence action from the area, the digital currency moved back towards the 50-Day exponential moving average. Interestingly, the blue curve changed to being support from being resistance. If Bitcoin (BTC) breaks beneath the 50-Day exponential moving average, it could fall to the $3,550 level as the next potential support.
As evidenced by a bear flag formation, Bitcoin (BTC) is presently in the first wave of a potential downward trend. While there is a chance that the value of the digital currency might return to its resistance area, the price action over the past months and the general sentiment around the digital currency indicates that it is due for an extended bear run. A breakdown action from the present stance of the digital currency would be confirmed immediately the value tests the flag support.
At the same time, there would be a significant increase in the trading volume. It could serve as a great opportunity for short traders, with a possible initial downward target close to the $3,550 level. Traders could as well be eyeing the support level of medium-term triangle formation.
Bitcoin (BTC) is currently trading in the green. The massive, sharp increase in the value of the digital currency is attributed to the upcoming hard fork of Ethereum. Ethereum (ETH) started the upward correction. However, it also began the downward correction, trading in the red five minutes before other digital currencies followed suit.
Bitcoin (BTC) Price Today – BTC / USD
At the time of writing, Bitcoin (BTC) is changing hands at $3,895 after an increase of less than one percent over the past twenty-four hours. The current market cap of the digital currency is $66.83 billion and its trading volume over the past twenty-four hours is $8.61 billion.