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  • Bitcoin defends $7,400 support but downtrend targets $7,200 before recovery ensues.
  • The trading sessions before the weekend are likely to characterized by ranging or sideways trading activities.

Bitcoin’s $8,000 support finally gave in to the selling pressure. Just as it has been predicted by many crypto analysts, Bitcoin continued to weaken towards $7,000. Fortunately, $7,400 came out as a strong support area. XBT/USD bounced back up stepping above $7,500. The price is doddering at $7,568 amid a generally lethargic but bullish momentum.

The sharp drop was indeed devastating to the investors. However, Bitcoin longs traders are choosing to remain bullish. From a technical perspective, bullish sentiments are supported. It should be apparent that lower corrections to levels around $7,200 are still possible.

XBT/USD 4-hour chart

XBT/USD price chart
XBT/USD price chart by Tradingview, BitMEX

Meanwhile, the formation of a double-bottom pattern is what the bulls are banking on for recovery. If Bitcoin reacts to the pattern as expected, its impact would have immense positive results. For instance, the journey above $8,000 will be a walk in the park. Besides, if $7,200 is the bottom Bitcoin is hoping to find, its target on the upside is $8,400.

An analysis of the Relative Strength Index shows Bitcoin settling in a lower consolidation range between $7,400 and $7,600. A clear bullish signal will follow the RSI’s resurface above 30. Further movement above the descending trend will place Bitcoin in a trajectory towards $8,000.

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CryptoMarketapp

Bitcoin must reclaim the position above the 50 Moving Average on the 4-hour chart. This move will cement the influence of the bulls in the market.

Bitcoin Key Technical Levels

BitMEX index price: $7,562

Volume: $3.4 billion

Open Interest: $751 million

Trend: Short-term bullish

RSI: Ranging direction signals sideways trading

Summary

XBT/USD Analysis: Is $7,200 Bottom Bitcoin Has Been Hunting For? BitMEX Margin Trading

Article Name

XBT/USD Analysis: Is $7,200 Bottom Bitcoin Has Been Hunting For? BitMEX Margin Trading

Description

Bitcoin defends $7,400 support but downtrend targets $7,200 before recovery ensues.
The trading sessions before the weekend are likely to characterized by ranging or sideways trading activities.

Author

John Isige

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Coingape

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cryptocoach

Coingape is committed to following the highest standards of journalism, and therefore, it abides by a strict editorial policy. While CoinGape takes all the measures to ensure that the facts presented in its news articles are accurate.

Disclaimer
The views, opinions, positions or strategies expressed by the authors and those providing comments are theirs alone, and do not necessarily reflect the views, opinions, positions or strategies of CoinGape. Do your market research before investing in cryptocurrencies. The author or publication does not hold any responsibility for your personal financial loss.



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John Isige , 2019-11-22 07:28:44 ,

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NewsBlock © 2019 - 2020 All rights reserved.

NewsBlock © 2019 - 2020. All rights reserved.


While Bitcoin’s price seemingly moves without rhyme or reason — collapsing by dozens of percent and embarking on face-melting rallies on a whim — the cryptocurrency market is filled to the brim with fractals.

Related Reading: Analyst: Bitcoin Price Likely to Fall to Low-$8,000s as Chart Remains Weak

A brief aside: A fractal, in the context of technical analysis and financial markets anyway, is when an asset’s price action is seen during a different time. This form of analysis isn’t that popular, but it has proven to be somewhat valuable in analyzing Bitcoin.

One recent fractal popularized by a well-known cryptocurrency trader is implying that BTC is going to return to the low-$7,000s in the coming days.

Bitcoin Fractal Implies Retracement to Low-$7,000s

A well-known crypto trader going by “Tyler Durden” on Twitter recently posted the chart below, which shows that a Bitcoin price fractal may be playing out. The fractal has four phases: horizontal consolidation marked by one fakeout, a surge above the consolidation phase, a distribution, then a strong drop to fresh lows.

If the fractal plays out in full, BTC could reach the low-$7,000s again, potentially as low as $7,100. This would represent a 20-odd percent collapse from the current price point of $8,800.

It isn’t only a fractal that is hinting Bitcoin has the potential to visit its lows. As we reported on Saturday, Bloomberg believes that if the GTI Vera Convergence Divergence Indicator flips red, a downtrend could push the cryptocurrency back to $7,300.

Related Reading: Stephen Colbert Pokes Fun at Bitcoin in Monologue: Mainstream Gone Wrong?

Can Bulls Step In?

But again, many believe it is irrational to have such bearish interpretations of the cryptocurrency’s chart at the moment. As reported by NewsBTC earlier, Popular crypto trader Mayne recently noted that the “people waiting for $6,000” are irrational. He quipped that Bitcoin retracing and consolidating after its fourth-biggest bull move in history ($7,300 to $10,500, a 42% gain) is perfectly par for the course, but noted that it’s totally possible we can go lower from $8,800.

The medium-term technicals support this.

Trader and CoinTelegraph contributor FilbFilb found that by the end of November or start of December, the 50-week and 100-week moving averages will see a “golden cross,” which he claims is far more significant” for the Bitcoin market that other technical crosses.

Also, a Bitcoin price model created using Facebook Prophet machine learning found that the leading cryptocurrency is likely to end the year at just over $12,000. What’s notable about this model is that it called the price drop to $8,000 months in advance, and forecasted a ~$7,500 price bottom for BTC.

To put a cherry on the cryptocurrency cake, Crypto Thies observed that when Bitcoin bottomed at $7,300, it bounced decisively off the 0.618 Fibonacci Retracement of the move from $3,000 to $14,000, which correlates with the two-week volume-weighted moving average. He added that summer 2019’s consolidation was marked by Bitcoin flipping major resistances into support levels, implying that a bullish reversal and subsequent continuation is likely possible in the coming weeks.

Featured Image from Shutterstock


Nick Chong , 2019-11-10 12:00:38

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