• The recent crash of the Bitcoin price has dropped nearly $5,000 in one day.
• The overall market structure looks bearish and there is a considerable probability for a pullback to the 200-day moving average and further continuation lower.
• A drop below the 200-day moving average points to a potential bearish shift.
Bitcoin’s price has recently crashed, losing nearly $5,000 in one day. The following analysis looks at the details behind the crash and how it affects the overall market’s trend.
On the daily timeframe, BTC has been rejected from the $30K resistance level multiple times in recent months which initiated a significant drop to the downside. Additionally, BTC has broken below the critical 200-day moving average around the $28K mark which points to a potential bearish shift. Meanwhile, support currently holds at $25K preventing deeper drops.
When analyzing on a 4-hour chart, BTC easily broke through both $27,500 and $25K levels with long wicks but it is currently consolidating around $25K area as this level prevents further dropping lower successfully. The RSI indicator has recovered above oversold region but still remains below 50%.
Overall, there may be a pullback to 200-day moving average and further continuation lower in coming weeks due to bearish market structure seen on both daily & 4-hour charts. However, as long as support persists near current level of 25K then any further decline will be limited for now.
For more detailed technical analysis regarding Bitcoin’s price movements please view TradingView’s chart here: https://www.tradingview.com/chart/BTCUSD/
This article should not be taken as financial advice; always do your own research before investing any funds!