Bitcoin Price Key Highlights
- Bitcoin price bounced off the area of interest at $1100 as expected and is resuming its slide.
- Price could move to the lows near $950 next, which happens to be the neckline of a head and shoulders pattern.
- A break below this support zone could set off an even longer-term drop, given the market risks facing bitcoin at the moment.
Bitcoin price seems to be setting its sights lower after completing a pullback to an area of interest and forming a head and shoulders pattern.
Technical Indicators Signals
The 100 SMA is below the longer-term 200 SMA, confirming that the path of least resistance is to the downside. These have also held as pretty strong inflection points so any pullback could encounter resistance at those levels.
Stochastic is on the move down to show that bears are in control of bitcoin price action. RSI is also turning lower so price could follow suit. However, stochastic seems to be turning slightly higher to indicate a potential return in buying pressure.
Market Events
The looming bitcoin hard fork is the main issue facing the cryptocurrency these days, as many fear that the newer version of the software could overtake the old one and render old bitcoins invalid. Although Bitcoin Unlimited hasn’t taken the majority from Bitcoin Core just yet, it is still moving dangerously close and the scalability of the network also needs to be addressed sooner rather than later.
Meanwhile, the dollar is also facing a crucial deciding moment as the healthcare vote is coming up. This could be a test of the Trump administration’s resolve, as failure to repeal Obamacare would cast doubts on whether they can push their agenda in Congress or not. On the line are policy changes pertaining to tax reform, financial deregulation, and infrastructure spending – all which are likely to have a big effect on US markets, the dollar, and overall risk sentiment.
Bitcoin price could move carefully from here but it looks like the factors are stacked more to the downside. After all, bitcoin is still reeling from the COIN ETF denial by the SEC and is facing potentially increased regulation in China.
Charts from SimpleFX
