• Since 5th of June, Bitcoin has been trapped largely in the $7,500–$8,100 trading range
• For the bullish outlook to revive and open the doors to $8,500, a high volume falling channel breakout on the 4 hour chart had to be confirmed.
• The price is more likely to fall back to $7,500 in the next 24 hours as the 4 hour moving averages and trading volumes indicates.
• The bearish doji reversal would be validated by a break below $7,500 confirmed by Sunday’s close below $8,000 and allow a deeper drop below $7,000.
With prices locked in a tight £600 range for the seventh day running, Bitcoin struggle for direction continues.
Bitcoin, the leading crypto by market value fell below $8,000 and on June 4, it found acceptance below the historically strong support of the 30-day price average , opening the doors for a deeper correction.
According to Bitstamp data, the downside has been massively restricted to levels near $7,500 since then. $7,449 low on June 6 was shown before closing at $7,806,
Sunday’s drop to $7,511 was short-lived as prices went back to levels above $8,000 yesterday. Over the last six days it was observed that the bulls have repeatedly failed again to force a sustained break above $8,000.
The immediate outlook is neutral as can be seen as prices are mostly in range. To put the bulls back in a commanding position, a convincing break above the upper edge of the range is highly needed and consequently, for a deeper price pullback, a break below the lower edge would again open the doors for it.
From the time of writing, BTC is changing hands at $7,820, representing a 1.2 percent gains on the day, having hit a high of $8,057 earlier today.
Bitcoin price bounce from Monday’s low of $7,511 has run out of steam as it is trapped within a falling channel on the 4-hour chart.
Again, looking at the average(MA), you can see it’s trending south as it has produced a bearish crossover with the 100-candle MA on June 7. The 50-candle MA now looks set to cross below the 200-candle MA. This is a case of moving averages being biased bearish.
Therefore, there is a risks falling back for BTC toward the lower end of the recent trading range of $7,500–$8,100.
Taking into account on the fact that trading volumes dropped sharply in the last 24 hours as the price recovered from $7,500 to $8,090, that means the situation for a pullback to $7,500 looks stronger .Volume bars have been printing lower highs since May 30 as seen from the chart above.
further more, if BTC leaves the falling channel with a high-volume move above the upper edge of the channel, currently at $8,050, the outlook would turn bullish
The bullish exhaustion signaled by the preceding week’s doji candle was validated bythe previous week’s candle which closed below $8,000.
BTC is flashing green this week despite the bearish doji reversal confirmation while Prices are still struggling to find acceptance above $8,000 – the doji candle’s low.
A deeper slide to levels below $7,000 could be seen as the bearish view gains credence if the rejection at $8,000 is actually followed by a drop below $7,500.
Disclosure: The author holds no cryptocurrency assets at the time of writing.
Credit: Omkar Godbole.JOIN OUR COMMUNITY