Over the past day, we’ve seen a correction in Bitcoin’s value. The correction was anticipated, as reported here yesterday, reaching the $3950 support level as the current daily low (the level was mentioned here as a possible target for the correction).
From there Bitcoin slowly recovered, and as of now, it’s facing the $4050 resistance one more time.
BitFinex downtime: BitFinex went down yesterday for several hours (servers migration). We expected some price action during that period, which didn’t occur at all. The bright side is that price manipulations delay any thoughts of approving Bitcoin’s ETF by Regulators.
Looking at the 1-day & 4-hour charts
- As stated yesterday: The $4050 is a well-known strong resistance level. The task won’t be easy. However, we could see the bulls pushing higher for the next targets: the next significant resistance lies at $4200. Following the above, the further resistance area is $4400 – $4500.
- Daily Chart: The RSI level had reached the long-term descending trend-line, which could be a resistance area. After the recent correction, the RSI is still a barrier for a positive continuation for Bitcoin.
- Support areas from the bearish side: $3950, $3900, $3800 – $3850 strong area (along with MA-50, MA-100 and the ascending trend-line) and $3700 (along with MA-200).
- The part that is missing from a possible bullish continuation is the trading volume segment, which is relatively low. It might be either no interest or that the holiday environment is still here.
- BitFinex’s open short positions decreased another 5% to their lowest point since the middle of November – 23.2K BTC. One reason might be that traders didn’t have enough time to re-open their positions, although the fact that the long positions are standing still (34K BTC).
- As a reminder – on November 14, the day when Bitcoin broke down the $6K mark sharply, the amount of open short positions was at its low – under 20K.
BTC/USD BitStamp 4-Hour chart
BTC/USD BitStamp 1-Day chart
Cryptocurrency charts by TradingView. Technical analysis tools by Coinigy.