Bear Revival? Bitcoin Risks Fall Below $8K After 3.5-Week Low

Bitcoin News

by Coin AIO 1068 views 449

Bitcoin (BTC) bears have unraveled the minor rally in prices since Saturday and are now looking to pull the cryptocurrency below the $8,000 mark, the technical charts indicate.

The bears' comeback comes after bitcoin saw minor gains after the May 12 low of $8,204, but the bulls repeatedly failed to cut through the key falling trendline hurdle. As a result, bitcoin fell to a 3.5-week low of $8,100 on Bitfinex earlier today.

As of writing, BTC is changing hands at $8,366 - down 4.7 percent in 24 hours.

Daily chart

The above chart shows that bitcoin has dipped below the 50-day moving average (MA), currently located at $8,290. As discussed yesterday, a close (as per UTC) below the 50-day MA would signal resumption of the sell-off from the recent high of $9,990 and could yield deeper sell-off to $7,800.

The rejection at the descending trendline hurdle and a drop to $8,100 has reinforced the bearish view put forward by the short-term moving averages (5-day and 10-day), which are sloping downwards in favor of the bears.

The retreat from $8,884 to $8,100 has also established a falling top (lower highs pattern) - a (you guessed it) bearish setup. While the 10-day MA has crossed the 100-day MA from above (bearish crossover), and the relative strength index (RSI) is also biased bearish (below 50.00 and falling).

As a result, there is a high probability that bitcoin will now go on to close today (as per UTC) below the 50-day MA and confirm a bear revival.

4-hour chart

The bad news (for the bulls, at least) continues in the 4-hour chart. The downside break of the expanding channel (bearish breakdown) indicates the sell-off from the May 5 high of $9,990 has resumed and could yield a drop to $7,524 (target as per the measured height method).

Note, the major moving averages (50, 100 and 200) are sloping downwards (bearish).

View

  • BTC will likely close below $8,290 (50-day MA) today and confirm a bear revival.
  • The cryptocurrency looks set to test support at $7,787 (61.8 percent Fibonacci retracement of the rally from April 1 low to May 5 high) and could go as low as $7,524 (expanding channel breakdown target) in the next 24-48 hours.
  • An unexpected break above $8,884 would abort the bearish view.

Bear graffiti image via Shutterstock

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