BTC/USD tumbled yesterday, breaking below 6100, the lower end of the recent sideways range the crypto had been trading within since the 6th of September. Most importantly, it closed the day below 5700 for the 1st time since the 25th of October 2017. In our view, yesterday’s slide has turned the outlook from flat to negative and suggests that more declined may be on the cards.
We believe that the dip below 5700 may have opened the way for the psychological round figure of 5000, marked slightly below the low of the 18th of October 2017, and slightly above the inside swing peak of the 1st of September of the same year. If that psychological level fails to stop the bears from driving the battle lower, then its break could set the stage for extensions towards the 4150 zone, marked by the lows of the 4th and 5th of October 2017.
Looking at our daily momentum studies, we see that the RSI dipped within its below-30 zone for the first time since February, while the MACD, which was running flat near its zero and trigger lines for more than a month now, has turned down within its negative territory. These indicators detect strong downside speed and support the notion for the cryptocurrency to continue drifting south.
On the upside, we would like to see a clear close above the 6800 territory, which acted as the upper bound of the aforementioned range, before we start examining whether the bulls have gained the upper hand. Something like that may allow the price to rise towards the peak of the 4th of September this year, at around 7400, the break of which could carry more bullish extensions, perhaps towards the 8450 zone, defined by the high of the 25th of July.
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