Bitcoin Analysis for 2019-12-24 [Premium Analysis]

Bitcoin Price Highlights

• The Bitcoin price failed to reach a close above the resistance area.
• It is possibly in the process of validating the previous descending resistance line.
• The price was rejected by the 50-day moving average.

Bitcoin’s Failed Rally

The Bitcoin price continued its rally yesterday and reached a high of $7715. The rally failed and the price created a bearish candlestick with a long upper wick. The price failed to reach a close above $7600, the last minor resistance area. Volume on the ensuing decrease was the highest since the December 18 upward move, indicating that the price might be in a short-term correction. Currently, the price is heading for the next minor support area at $7200. The rally had shown weakness prior to the decrease, creating bearish divergence in both the RSI & the MACD. However, the divergence was only present in lower time-frames — somewhat reducing its significance. It is entirely possible that the current downward move is an attempt to validate the previous descending resistance line. There is a point of convergence between the next minor support and the previous descending resistance line, which would be a very likely place for a reversal. It is found near $7200.

Daily Outlook

The daily outlook reveals that, despite the December 18 massive price increase, BTC is still facing strong resistance — most recently from the 50-day moving average (MA). Therefore, until it breaks out above $7800, we should still consider its outlook bearish. To conclude, Bitcoin’s rally yesterday ended at $7715 and the price has decreased by more than five percent since. It is in the process of returning to validate the previous descending resistance line, after which we expect it to make another attempt at moving above resistance. Good luck and happy trading! For our previous analysis, click here.