CoinDesk analysis of Bitcoin price movements
At 11:00 UTC today on CoinDesk, Omkar Godpole released a technical analysis of Bitcoin’s price fluctuations. He argues that Bitcoin is on the defensive after it breached critical support on Monday. He claims that the price could suffer an even larger drop as there has been a bearish crossover between key moving averages.
On Friday there had been a break above $6,600 and this set the stage for a move toward the next psychological hurdle of $7,000. However, over the weekend the rally fizzled out. On Saturday Bitcoin was able to hit a 17-day high of $6,800 but yesterday it dropped back below $6,600 and this neutralized any bullish outlook.
The pullback from the weekend high of $6,841 to a low so far today of $6,370 confirms the bearish outlook indicated by the negative moving average crossover shown on the monthly chart. In the next few days, consequently Bitcoin could fall below the support level of $6,000.
Chart analysis
The daily chart shows that Bitcoin’s price has found acceptance below the double bottom neckline of $6,600. This bullish failure is not sufficient to definitely show a bearish reversal. BTC is still trapped in the large pennant formation. A UTC close below the lower edge of the pattern would indicate a sell off is continuing from the May highs that were above $8,500. The longer duration monthly chart, however, shows that the likelihood of a downside move is high.
The monthly chart shows that the five month exponential moving average (EMA) has crossed the ten month EMA from above at the turn of last month. This confirms a bearish crossover. Also, BTC’s inability to stay about the MA’s over last weekend confirms the negative MA signal.
CoinDesk’s outlook
Based on his technical analysis, Godpole’s view is: ” BTC’s drop below $6,600 yesterday has neutralized the immediate bullish outlook. A downside break of the pennant pattern in the daily chart would open doors for re-test of the June low of $5,755. The bearish crossover between the 5-month and 10-month EMAs indicates that BTC is more likely to find acceptance below the pennant support, currently located at $6,265.”
Present situation
BTC opened the day at $6,581 which was also the high for the day. It took several dips to reach a low of $6,334 but closed a hundred dollars above that but still far over a hundred dollars down for the day. It is now Wednesday Sept. 26 UTC time, The price of Bitcoin opened at $6,434 which has been the high so far, The low has been $6,381. At 02:13 UTC the price was $6,402. While BTC is down in price it is still not at the pennant support level of $6,265. However, the day is just starting. The present price of Bitcoin can be found here.
