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article imageBitcoin dips below $7,000 both Sunday and Monday

By Ken Hanly     Aug 6, 2018 in Technology
Bitcoin's (BTC) price started out Sunday just over $7,000 but then descended below that level but ended up a bit over the mark again. On Monday it again dropped considerably below the $7,000 level after beginning the day slightly above.
CoinDesk's analysis
A recent article on CoinDesk posted at 11:49 UTC notes that BTC is trading in an indecisive manner after it posted a 19-day low below $6,900 yesterday. However, technical studies show it could perk up if it finds acceptance above the $7,100 level.
On Sunday BTC dropped down to $6,890 on Bitfinex exchange. This is its lowest level since July 17. However, it recovered somewhat to end just over $7,000 at $7,025 slightly up from its open.
The movements of the price show no clear bias. This could be considered bearish exhaustion as the price has already sunk 21 percent from a recent $8,507 high.
Should the price rise above the Sunday high of $7,090 on Bitfinex there could be a minor corrective rally. However, a slide below the low yesterday of $6,890 would revive a bearish view. As the article went to press the price of BTC was $6,975 down 0.80 percent over 24 hours.
Chart analysis
The daily chart shows that BTC created a doji candle that marked indecision on Sunday at the 50-day moving average (MA) support. This will make today's close pivotal. A bull doji reversal is confirmed if BTC closes today above $7,090. If this happens we could see a corrective rally to the 100-day MA just now at $7,474.
On the other hand, if the close today is below $6,890, Sunday's doji candle's low this would signal the sell off will continue.
If the bulls don't have a rally soon, the focus will return to bearish factors. These include a down-trending 5-day and 10-day MA, and the breach of the key support 100-day MA last week. The relative strength index is also bearish.
BTC is also close to the important inverse head-and-shoulders neckline support of $6,820 indicating that the bulls need a rally soon. A move below this level would invalidate the bearish-to-bullish trend leading to a further drop.
The weekly chart shows the long term bullish view is invalidated by the bitcoin close yesterday at $7,025.
CoinDesk's predictions
Based on its technical analysis CoinDesk's view is: "BTC could rise back to 100-day MA of $7,474 if prices close today above $7,090. That said, the short-term bias would remain bearish as long as the 5-day and 10-day MAs are trending south.
A close today below $6,890 would increase the risk of a drop below the key rising trendline support, currently seen at $6,700."
Present situation
Bitcoin's price opened today marginally higher than yesterday's $2,009 at $2,026 but dropped down to a low so far of $6,885. The high so far has been just $7,145. At 18:33 UTC bitcoin was trading at just $6,908 not far off its low for the day. The movement appears to be in a narrow range as if bitcoin is consolidating before a move up or down. It is not clear which of the two levels mentioned in the CoinDesk outlook bitcoin will close above or below. There are still five hours left in the day to go. The present price of bitcoin can be found here.
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