Against every bullish expectation, bitcoin price finally lost its latest upside today to growing bearish pressure.
The BTC/USD on Wednesday plunged as much as 7 percent. The pair seemed to have overstayed its welcome near the resistance of our Rising Wedge channel. There was absolutely no buying sentiment visible around the area in the past three days. The early Asian session saw to it and started crashing the value. By mid-Asian and early-European session, BTC/USD had crashed from its intraday high near 7400-fiat to a new intraday low towards 6902-fiat.
As we now enter the US time, the pair is hinting no reversal and could go testing more downsides as the session matures.
BTC/USD has invalidated our rising wedge support already to the downside. Traditionally, this could mean an extended volatile drop of at least $500. Fundamentally, there could be more thanks to a rumor that predicts a $1bn worth of Bitcoin dump by one Bitcoin whale. Sentiments, after all, prevails technicals as far as trading is concerned.
Nevertheless, for the sake of what our heading suggests, we’ll stick to the technical overview of Bitcoin market. That said, the BTC/USD pair is indeed heading inside a strong bearish zone. The pair is close to testing its 100H MA for a potential pullback which could resume our bullish hopes and reject the prevailing downtrend as yet another bull pennant formation. However, if the 100H MA is broken, there would be a risk to an extended downside momentum.
The RSI and Stochastic Oscillator indicators both have slipped into their respective oversold regions and might continue to the prevailing directions, awaiting a minor/major bounce back.
From the intraday perspective, we are definitely inside a new range defined by a new interim support at 6832-fiat and interim resistance at 7130-fiat. We’ll be first waiting for BTC/USD to test 6832-fiat and 100H MA for a potential bounce back. Should it happen, we’ll leave no opportunity to enter a long position towards 7130-fiat, as the part of our intrarange strategy. An extended break above the resistance will have us put another long towards 7264-fiat, our intermediary upside target with an open view towards 7429-fiat. At the same time, we will keep our stops four-pips below the entry point on every long position.
In case we break below the 6832-support, we will enter a short position towards 6750-fat while keeping our stop loss four-pips above the entry point.