Bitcoin Price Highlights
- The Bitcoin price is trading inside a descending channel.
- It made a rapid upward move which retraced completely.
- There is resistance at $7,900.
- There is support at $7,000.
- The daily chart shows the validation of resistance.
Descending ChannelThe Bitcoin price is trading inside a parallel descending channel. Yesterday, it initiated a very rapid upward move on the back of significant trading volume that reached a high of $7,900. However, the price retraced by more than 100% and created a long upper wick. Volume was much during the downward move.
Resistance ValidationThe daily chart looks extremely bearish. The price validated the resistance area at $7,900 which previously acted as support. Additionally, yesterday’s candlestick closed bearish and had a very long upper wick, indicating a great amount of selling pressure. This suggests a continued downward move until BTC makes a lower-low close to the descending support line.
Trading RangeBesides the descending channel, we can see that the price is likely trading in a range between $7,000-$7,900. The lower-lows on Nov 25, which could not be sustained, was a catalyst for the ensuing upward move that led to $7,900. It would be possible for the price to continue decreasing at the rate predicted by the channel until it reaches $7,000 before initiating an upward move. However, due to the bearishness of the daily chart, it seems more likely that a breakdown will occur, which would take the price back to the lows of Nov 25 near $6,700. To conclude, yesterday’s failed upward move has created a bearish sentiment which suggests that the price will make a lower low. For our previous analysis, click here.
Disclaimer: This article is not trading advice and should not be construed as such. Always consult a trained financial professional before investing in cryptocurrencies, as the market is particularly volatile.
In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions.