Bitcoin: USD/BTC (BTC=X) A Drop Below $8,000 Opens the Doors Toward $5,000

Bitcoin: USD/BTC (BTC=X) A Drop Below $8,000 Opens the Doors Toward $5,000

The round level at $8,000 is an important psychological support factor. We saw a strengthening of buys as Bitcoin approached this mark by the end of the Monday. However, Bitcoin’s position has been worsening since this morning. Almost immediately below this mark – around $7,900 – there is a 200-day simple moving average.

This is an important signal level, which has stopped the sell-offs several times before. The last time we saw this was in October, and in April, when Bitcoin started its rally from 5K to 14K after almost a month of a sideways trend.

So, if Bitcoin can’t withstand bear pressure at $8K, we can expect a very sharp dive with the nearest important stop at $5,000. A sharp decline of Bitcoin couldn’t but pull the rest of the crypto market. Over the last day, the total capitalization slipped by $9bn. Bitcoin Cash (BCH) became the record-breaker on the decline, losing 7.5% on the previous day. Other altcoins from TOP-10 lose less. However, all are confidently in a red zone. Waves of “desperate sell-offs” of altcoins (when the investor fixes huge losses) will intensify with the further drawdown of alternative cryptocurrencies, as the current price levels for many coins are significantly lower than any psychological levels.

Some well-known analysts predict the growth of the benchmark cryptocurrency up to $25K, but we are talking about 2022, so such forecasts do not cause any excitement. What if the summer growth to $14K was a rally in the bear market? There are suggestions that the “pump” may be associated with the rise of positions before halving, and if it is true, then in the medium term BTC may be caught in a “depressive sideways trend”. We are talking about successive sideways trends when almost each of them ends with a decline.

From the beginning of 2020, investors will be waiting for growth based on halving, which will support the price of Bitcoin, but if, as the event approaches, everyone begins to realize that “the best is in the past”, it may lead to a new large-scale sale. This would be the worst medium-term forecast for Bitcoin, but this scenario cannot be ruled out. 2019 gave the market new hope, but judging by the fact that Litecoin was bought long before halving, and initiated a sale a few months before halving, in the case of Bitcoin, this period could be much more significant.

Technical Indicators

Overall, the bias in prices is: Downwards.

Note: this chart shows extraordinary price action to the downside.

By the way, prices are vulnerable to a correction towards 8,837.33.

The projected upper bound is: 8,970.43.

The projected lower bound is: 7,375.31.

The projected closing price is: 8,172.87.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 17 white candles and 33 black candles for a net of 16 black candles.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 30.6084. This is not an overbought or oversold reading. The last signal was a sell 21 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 38.00. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 44 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -130.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 3 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 12 period(s) ago.

Rex Takasugi – TD Profile

FOREX BTC= closed up 72.000 at 8,177.000. Volume was 96% below average (consolidating) and Bollinger Bands were 17% narrower than normal.

Open     High      Low     Close     Volume___
8,108.2508,191.9007,999.5708,177.000 2,848
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 8,486.29 8,562.03 9,358.14
Volatility: 33 61 78
Volume: 64,519 77,583 85,617

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

FOREX BTC= is currently 12.6% below its 200-period moving average and is in an downward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect moderate flows of volume out of BTC= (mildly bearish). Our trend forecasting oscillators are currently bearish on BTC= and have had this outlook for the last 6 periods.

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