Falling by 25% week-by-week, bitcoin runs the risk of repeating its worst result since April 2013. Today’s selloff gained momentum, when prices neared a 10-week low at $8100. Depreciation can continue – this is indicated by technical analysis.
Dropping below the psychological level of $9 000, the price of bitcoin fell to $8 056 11:39 UTC. This is the lowest level since 25 November last year. According to OnChinaFX, the last day of the largest cryptocurrency has lost 14%.
In addition, it is worth noting that the price of BTC on the Korean stock exchanges are now traded at a discount relative to the prices of foreign exchanges. For example, BTC resold for $8 227 on the stock exchange GDAX and Bithumb – $7 960. As a result, prices on the Korean stock exchanges have a discount of more than $250.
Until last month, the prize on the Korean stock exchanges (known as “Kimchi-award”) was so high that it would distort the average price of bitcoin. Thus, January 8 the data source is CoinMarketCap decided to exclude Korean prices from average calculations.
Bitcoin isn’t the only cryptocurrency which is losing ground. The token Ripple XRP fell by 31% in the last 24 hours. Ethereum, Bitcoin, Cash, Litecoin NEO and has also lost at least 20% each. In addition, the total market capitalization of all cryptocurrencies have declined by more than $100 billion in 24 hours.
Since the beginning of the year, the cryptocurrency markets are suffering losses due to a series of negative news. So, concerns about tighter regulation in China and South Korea strongly influenced the bitcoin in January.
Although the situation in the cryptocurrency market now looks grim, the charts show that in the near future all can change.
The above chart (prices in accordance with Coinbase) shows that BTC is rapidly approaching $8 052 (61.8% Fibonacci retracement from 2017).Support is the 200-day moving average (MA) is at $7 855.BTC is in danger to stop the fall in prices.The relative strength index (RSI) and stochastic indicator indicate oversold.
Daily closure (according to UTC) below $8 052 will only strengthen the bearish market. It would also mean the acceleration of the decline linked to falling prices (represented by lines connecting the lower highs and lower lows).
However, as noted above, the indicators point to oversold. In addition, the 4-hour RSI and stochastics show an exaggerated sell-off. Probably, BTC will justify the support of 200-day moving average (MA), which is around $7 855.
Sale can stay in the range of $7 855 (200 day MA) and $8 052 (61.8% Fibonacci retracement from 2017).You can expect a technical recovery, but the profit above $9 000 may be short-term in the short term.Consolidate about $8,000 in the next 72 hours, with subsequent daily closing (according to UTC) below the 200-day MA can quicken a sale and open the way to $6 189 (maximum 21 October).