Bitcoin Price Looks South After Worst Daily Loss Since November




  • In Tech
  • 2019-01-11 11:00:16Z
  • By Coindesk
 

Bitcoin’s (BTC) price saw its biggest drop for seven weeks on Thursday, weakening the prospects of a bullish breakout above $4,100.

The world's largest cryptocurrency by market value hit a 3.5-week low of $3,503 yesterday, before closing (as per UTC) at $3,627 – down 9.4 percent on the day. That was the biggest single-day drop since Nov. 24 and the fourth biggest daily loss of the last two months, according to CoinDesk's Bitcoin Price Index (BPI).

Essentially, the hard-fought gains of the last two weeks have been erased in the last 24 hours. The cryptocurrency had carved out a bullish-higher low near $3,550 on Dec. 27 before crossing $4,000 on Jan. 6.

Bitcoin Price Slips Below $3.8K as Bullish Bets Tank

The follow-through to break above $4,000, however, was anything but encouraging. Moreover, signs of bullish exhaustion emerged near the crucial resistance of $4,130 (inverse head-and-shoulders neckline) and demoralized bulls started to exit the market yesterday, leading to a sharp drop in prices.

As a result, the bears may be feeling emboldened and could attack the crucial support lined up near $3,550. As of writing, BTC is changing hands at $3,630.

Daily chart

Bitcoin fell to $3,500 yesterday, confirming a bearish doji reversal on the daily chart. The cryptocurrency also closed below the crucial 50-day moving average (MA) support,

Adding credence to the bearish move, trading volumes jumped to the highest level since Dec. 21 and 14-day relative strength index (RSI) breached the ascending trendline to the downside.

Bullish Sentiment for Bitcoin Is at a 5-Month High

With the odds stacked in favor of the bears, the immediate support of $3,566 (Dec. 27 low) could be breached soon. That would only bolster the already bearish technical setup.

Weekly chart

On the weekly chart, BTC has created a bearish outside reversal candle – this week's price action has engulfed the previous week's high and low - having failed to penetrate the 200-week exponential moving average (EMA) hurdle for four weeks straight.

The candlestick pattern indicates that the week began with optimism, but is approaching a more pessimistic close. As a result, it is widely considered a sign of bearish reversal.

Put simply, the doors have been opened for a re-test of the 200-week MA lined up at $3,250. Supporting that bearish case is the downward sloping 10-week MA.

View

 Disclosure: The author holds no cryptocurrency assets at the time of writing.

Bitcoin image via Shutterstock; Charts by Trading View

COMMENTS

More Related News

Cryptocurrencies are fascinating, says Digitec-Galaxus
Cryptocurrencies are fascinating, says Digitec-Galaxus

Swiss online retailer Digitec-Galaxus is now accepting Bitcoin as a means of payment. Other altcoins that can be used include Bitcoin Cash (BCH), Bitcoin Cash SV (BSV), Ethereum (ETH), Ripple (XRP), Binance Coin (BNB), Litecoin (LTC), TRON (TRX), OmiseGo (OMG), and NEO (NEO). "Cryptocurrencies are fascinating and could become a relevant means of payment in e-commerce. We would like to support this development," says Digitec Co-Founder Oliver Herren and Chief Innovation Officer. "We have wanted to do this for a long time, but it was too complicated until now." The company insists that price volatility will not be a problem, as all transactions are processed by third-party payment processor...

The importance of cryptocurrency journalism
The importance of cryptocurrency journalism

Criticism of journalism has increased in recent years. There has also been the swathe of criticism over fake news. This criticism has spread to the world of cryptocurrency journalism as well. This week, my colleagues sat down to discuss the issue of journalism in a Coin Rivet debate. Sadly, I wasn't able to attend, but I found it extremely interesting viewing. I myself am not a journalist. I am fortunate that I get to write what are essentially opinion pieces. Saying that, there are a few points that I think were very interesting from the discussion. The Coin Rivet newsroom is not one where we sit down and pat each other on the back discussing how great our beliefs are. The post The...

10 famous cryptocurrency quotes and what we can learn from them
10 famous cryptocurrency quotes and what we can learn from them

With Bitcoin recently turning 10, there is a full decade of cryptocurrency quotes to catch up on if you are new to the space. Here is a select list of some of the most famous and what we can learn from them. "If you don't believe it or don't get it, I don't have the time to try to convince you, sorry." - Satoshi Nakamoto This is an early quote from Satoshi Nakamoto to the Bitcoin doubters on the forums. Since those early days, a whole industry has been created around his invention. With hindsight, it is easy to say that perhaps people should have listened, but what was created was something entirely unique and therefore difficult for many to The post 10 famous cryptocurrency quotes and...

How to buy cryptocurrency with USD
How to buy cryptocurrency with USD

If you find yourself constantly wondering how to buy cryptocurrency with USD, then don't worry. By the end of this article, you will know exactly where to go and what to do. Before you start thinking about how to buy cryptocurrencies, you will need to choose which digital asset you want to invest in. Websites such as CoinMarketCap and Investing.com will give you a list of the top-100 cryptocurrencies by market capitalisation and how much they are currently trading for against USD. Chosen your cryptocurrency? Great! Now it's time to buy. Exchanges are the easiest and safest way to buy cryptocurrencies with your fiat currency. Exchanges are online platforms that allow users to buy and trade...

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply

Comments

Top News: Tech

facebook
Hit "Like"
Don't miss any important news
Thanks, you don't need to show me this anymore.