The short-term action continues going back and forth inside the horizontal triangle marked below on the 4-hour chart.
After two days of consolidation below the triangle’s descending trend line with zero success breaking through, Bitcoin plunged $800 to $10,082. As mentioned in our previous analysis, the $10,800 area provided tough resistance, containing the 50-day moving average line (marked in purple) and the 4-hour descending trend line (marked in yellow).
Looking at the daily chart, Bitcoin has yet to produce a higher low and has been moving in a lower-high formation, which is bearish. The question is, can Bitcoin maintain the lower boundary of the triangle, which is roughly around $9,950-$10,000? That support has held for over a month now.
Total Market Cap: $264 billion
Bitcoin Market Cap: $182 billion
BTC Dominance Index: 68.9%
*Data from CoinGecko
Key Levels to Watch
Support/Resistance: Following the recent plunge, Bitcoin is now near the aforementioned strong support between $9,800 and $10,000, along with the ascending trend line on the 4-hour chart and the 100-day moving average line (marked in white).
In case of a break down below this area, the next support levels to be tested are $9,600 and $9,300-$9,400. The latter is a crucial area which contains the red ascending trend line on the daily chart. Below that are $8,800 and $8,500.
Current resistance levels include the $10,300 support-turned-resistance area, $10,600 (the 4-hour MA-200) and $10,800.
Daily chart’s RSI: The RSI indicator looks bearish after failing to remain above 50 and now faces the 43-44 level in a last effort to stay above its previous low. If the RSI succeeds in that regard, it might be a first bullish sign that the price could indeed remain above the $10,000 region and that the bulls are still present.
Trading Volume: We are witnessing one of the lowest volume weeks since April. It may be typical for July and August, but this amount of volume could be enough to move the whole Bitcoin market.
BTC/USD Bitstamp 4-Hour Chart
BTC/USD Bitstamp 1-Day Chart
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Cryptocurrency charts by TradingView.