We had discussed in the previous Bitcoin price analysis Breakdown Coming? that Bitcoin is expected to breach the floor of the descending triangle, and according to the latest price action and the technical indications, the probability of that happening has increased significantly.
Bitcoin is currently trading down 1.41% at $277.10.
Technically, both the price action and the technical indicators have turned extremely bearish for Bitcoin, implying that more pain is coming for the cryptocurrency.
Bitcoin Chart Structure – With the latest decline, Bitcoin has slumped to a new weekly low of $276.20. The cryptocurrency is now trading at the edge of the support, and even a slight downward push will see Bitcoin sinking towards its target of $257.
Fibonacci Retracements – As has been expressed earlier, Bitcoin has finally breached the cushion provided by the 38.2% Fibonacci retracement of $280. I am not expecting this slide to end before it meets its 61.8% Fibonacci retracement of $256.81.
Moving Average Convergence Divergence – MACD is seen fast skidding towards the 0-mark as momentum turns negative. The Signal Line has also undergone a cut thereby limiting the losses in Histogram. The latest values are 1.7040 for MACD, 4.1655 for Signal Line and -2.4614 for Histogram.
Momentum – The Momentum reading has slumped to -16.9100.
Money Flow Index – The MFI has shown a sharp depreciation from 59.4824 to 49.1053.
Relative Strength Index – The RSI has weakened to 46.7666.
Bitcoin is looking weak and bears should pounce on this chance. Create short positions by placing a stop-loss above $282 – the resistance posed by the downward sloping trendline – for a target of $256.
But I may be proved wrong if the bears fail to push the closing price below $275. In that case, short-covering may lift the price back up to the mentioned resistance level.
Expect a big move in Bitcoin by the end of this week!