Where Will Bitcoin’s Decrease Come to an End?

Since the beginning of the day, BTC has already decreased by 4.5%. However, even though lower time-frames give a bearish outlook, the price is still trading above numerous long-term support levels. Well-known trader @Crypto_rand tweeted a Bitcoin chart that shows the price sitting above a long-term ascending support line and inside a minor support area.

He believes that shorting here is not a good idea, reiterating his thoughts by stating:

I don’t know if we are going to the moon from here. But on thing is clear:  Shorting or panic selling on the uptrend support confluence with the horizontal range support tends to be a bad idea.

Ascending Support

The Bitcoin price has been following an ascending support line since it reached a bottom on March 13. However, the slope of the line is not yet clear, since it is quite different based on whether price closes or wicks are used. Furthermore, both potential lines have been validated four times and are at a confluence of horizontal and diagonal support levels. The dashed ascending support line coincides with the $9,100 support area. At the time of writing, the price has slightly bounced above this line and is still respecting the support line. If the price breaks down, the second ascending support line would be found at $8,600, also coinciding with the horizontal support level at this price.

Horizontal Support Levels

In lower time-frames, we can see that the $9,000 area is also a minor support level, found between the longer-term resistance and support found at $9,400 and $8,600, respectively. Furthermore, the price has also found support above the 250-day MA. It was this same MA that halted the rapid decrease on May 10. Therefore, even though the price is mired inside a very strong decrease, it is still resting above numerous support levels, making a continued decrease at this rate unlikely.

However, the 10-minute chart shows no signs of reversal whatsoever. While the price has made a higher low at $9,050, it has also generated hidden bearish divergence. Furthermore, the price is trading inside a symmetrical triangle, which is considered a neutral pattern but often leads to breakdowns if it comes after a downward move.

To conclude, the Bitcoin price has been decreasing rapidly on May 21. While it is trading inside a confluence of support levels, which make a bounce likely, there are no short-term signs of a reversal yet.