Bitcoin does not seem to improve, reverses to near $10k mark
Mar 09, 2018 Posted / 7682 Views
Bitcoin was asking for some stability and consolidation after witnessing lows for a significant portion of time in two months. But after finding support at $11,000 it was challenging to break the point and the value of the bitcoin is tracing back to risk points of $10k levels.
Bitcoin is in a restoration mode after the apparently news-driven drop, but the gains could be temporary, technical analysts advises. CoinMarketCap Bitcoin Price Index (BPI) had bounced back to $10,070, which was 6 percent up from the previous day's low of $9,468 - and was last seen at $9,993. However, on a 24-hour basis, the world's largest cryptocurrency by market capitalization is still reporting a 4.25 percent drop, according to CoinMarketCap.
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If you will study the price index two days back, bitcoin (BTC) was trading around $10,500 and clocked a high of $10,702 before falling more than $1,000 to the lowest level since Feb. 26.
Although the sell-off was mostly in line with bearish technical set up, negative news flow seems to have added fuel to the fire.
As reported by the media, it was unveiled that the trustee of collapsed Japanese bitcoin exchange Mt Gox, Nobuaki Kobayashi, had dumped $400 million-worth of bitcoin and bitcoin cash. Reports of unauthorized sells on cryptocurrency exchange Binance and technical issues at cryptocurrency derivatives exchange BitMEX, adding to bearish pressure around BTC.
Further, the SEC issued a statement that looks to have added to the market's jitters. For now, though, it appears the sell-off has ended around the key 38.2 percent Fibonacci retracement of the rally from the Feb. 6 low and Feb. 20 low.
BTC left a higher low around $9,577 (38.2 percent Fibonacci retracement) in late February and rose to $11,700 (Mar. 5 high). Once again, the 38.2 percent Fibonacci retracement is proving a tough nut to crack.
It is indicated on the price charts of various exchanges that BTC could re-test the descending 50-hour moving average (MA), currently seen at $10,427.
Bitcoin's close (as per UTC) below the 50-day MA yesterday, and the bearish 5-day MA and 10-day MA crossover, add credence to the bearish setup discussed yesterday and has boosted the odds of a further decline in prices. And, the RSI has dipped below 50.00, also signaling a scope for further losses.
A minor corrective rally to $10,400-$10,500 cannot be ruled out, but gains will likely be short-lived.
BTC looks set to test $8,906 (200-day MA) and could extend the decline to $8,000.
Let us assume a Bullish scenario: A high volume break above $11,000 in the next 72 hours would mean the sell-off from March 5 high of $11,700 has bottomed out around $9,577 (38.2 percent Fibonacci retracement) and could yield a much-awaited bullish break above the inverse head-and-shoulders neckline resistance.
Applancer is an open platform for discussion on all things like Blockchain , Cryptocurrency and Ico news updates. As such, the opinions expressed in this article are the author's own and do not necessarily reflect the view of Applancer .
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