02 Feb Bitcoin Price Technical Analysis for 02/02/2018 – Another Nearby Support
Bitcoin Price Key Highlights
- Bitcoin price went on another leg lower after breaking below a short-term triangle consolidation pattern.
- Price is now testing another potential support at the bottom of its falling wedge pattern visible on the 4-hour time frame.
- Price could bounce off this area and make another test of the wedge resistance around the $10,000 area of interest.
Bitcoin price can’t quite catch a break as it suffered another selloff to the $9,000 handle.
Technical Indicators Signals
The 100 SMA is still below the longer-term 200 SMA to indicate that the path of least resistance is to the downside. In other words, the selloff is more likely to continue than to reverse.
In addition, the gap between the moving averages is widening to reflect stronger selling pressure, possibly leading to a wedge breakdown. Note that this chart pattern spans $9,000 to $19,000 so the resulting breakout could be of the same height.
Stochastic is indicating oversold conditions, though, which means that bears are tired and could let bulls take over bitcoin price action. RSI is also ready to pull up from the oversold level to signal a pickup in buying momentum.
Not even dollar weakness was enough to keep a lid on BTCUSD losses recently as negative sentiment for the cryptocurrency industry is prevailing. The lack of any positive updates is convincing more and more investors to liquidate their holdings, thereby exacerbating the selloff.
Analyst say that the increased scrutiny from regulators is still to blame for the tumble, especially since the CFTC announced plans to beef up its bitcoin futures review process. According to Chairman Giancarlo:
“The CFTC’s current product self-certification framework is consistent with public policy that encourages market-driven innovation that has made America’s listed futures markets the envy of the world. Whatever the market impact of bitcoin futures, I hope it is not to compromise the product self-certification process that has served so well for so long”.
This could involve setting “exchange large trader reporting thresholds at five bitcoins or less” and entering into “information sharing agreements with spot market platforms to allow access to trade and trader data.”
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