ForexMinute.com — The cryptocurrency market returned to its bearish levels after facing a slow and organic Bitcoin uptrend for too long. Probably, the traders shorted their positions when price failed to form higher highs near the 246-250 resistance area.
The impact of Bitcoin’s fall was subsequently rippled through the closest alternative cryptocurrency Litecoin and Dogecoin, both of which fell around 3% each. The Darkcoin however faced the maximum blow and dropped around 7% within the last 24 hours.
BTC/USD 4H BitFinex Chart
After trending smoothly towards the 246-resistance level, the BTC/USD lost some upward momentum. It subsequently resulted into a shaky sell-off, as you can notice those two red candles at the end of the chart above. The drop however failed to extend into a breakout, thanks to a much stronger support around 234-236 area. But at the same time, price has not attempted a pullback — clearly signifying the absence of enough buying volume near the support.
If market continues to stay there for long, traders might start shorting their positions. This will subsequently result into another sell-off, this time towards the presumed bottom near 227. A further extension to this trend will bring back old support levels around 210 in sight.
At press time, the BTC/USD is clearly trending in a strong bearish area, while awaiting corrections. The technical indicators are also expressing the same theory, as price is clearly below its 50H SMA, while the RSI has dropped below 40 — an oversold area. The MACD blue curve meanwhile is clearly below the signal curve and normal line.
There is practically no influential buying/selling out there that reflect the future price movement further. This leaves the market in the hands of bears. Watch out for 227 to enter the market. Short if it goes below it.