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by Charalambos Pissouros

Bitcoin Tumbles Below 7000

BTC/USD tumbled yesterday afternoon, falling below the 7000 zone, which acted as a decent support during most of the day. Then, the fall was stopped near the 6815 level, marked by the low of November 27th, with the crypto rebounding somewhat. Overall, Bitcoin is trading below a downside resistance line taken from the high of November 4th and thus, we would consider the short-term outlook to be somewhat negative.

The price could trade a bit higher, to test the 7000 zone as a resistance this time, but the bears could quickly take charge from near that zone and drive the battle back down for another test near 6815. A break below that level could carry larger bearish implications, perhaps paving the way towards the 6545 zone, which is slightly above the low of November 25th.

Taking a look at our short-term oscillators, we see that the RSI exited its below-30 zone, but turned back down, while the MACD lies below both its zero and trigger lines, but shows signs that it could start bottoming soon. Both studies suggest negative momentum. However, the fact that the MACD shows signs of bottoming adds somewhat to the case of a small recovery before the next leg lower.

In order to abandon the bearish case though and start examining the bullish one, we would like to see a decisive break above 7115. Such a move would also bring the rate above the aforementioned downside resistance line and may initially pave the way towards the 7270 barrier, marked by the high of December 13th. If that level is not able to stop the recovery, then its break may lead the bulls towards the 7530 territory.

Bitcoin BTC/USD 4-hour chart technical analysis

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