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Bitcoin (BTC) has fallen to its lowest level since October 2017, as losses are recorded in the broadest encrypted market.
The major cryptocurrency declined to $ 5,165 earlier today – the lowest level since October 18, 2017 – having passed the crucial $ 6,000 support last week.
At the time of writing, BTC is changing hands to $ 5.283 – down 5 percent on a 24-hour basis and 16 percent week-over-week – according to CoinDesk's BPI (Bitcoin Price Index). In addition, year-on-year loss now stands at 32%, as prices were trading well above $ 7,600 on November 19, 2017.
Elsewhere, the ETH token of ethereum, cardano and Tron are also recording double-digit losses on a 24-hour basis. In particular, ETH fell to $ 155 previously, the lowest level since July 16, 2017, as per CoinMarketCap. Meanwhile, XRP, the second largest cryptocurrency based on market capitalization, recorded a decline of 6.5 percent. Only nine of the top 100 cryptocurrencies for market capitalization are traded in green and three out of nine are stablecoin anchored in legal currencies.
The strong losses in the major cryptocurrencies pushed the total market capitalization to a minimum of 13 months of $ 172 billion. In the last five days, the total value has fallen by over $ 30 billion.
Risk aversion could worsen in the short term, as bitcoin appears increasingly weak in the technical rankings.
Weekly chart
As seen above, BTC closed last week (UTC) to $ 5,560, confirming a downward rupture of the nine-month downtrend channel – a bearish continuation model.
The cryptocurrency also closed below the 100-week exponential moving average (EMA), which since June has served as a support. More importantly, both the 50- and 100-week EMAs have lost their uptrend.
The 14-week relative strength index (RSI) of 37.00 is signaling the possibility of a deeper sale.
Therefore, BTC is likely to fall below the $ 5,000 short-term psychological support. The largest support below this level is seen around $ 4,100 (trend line linking the lows of January 2015 and April 2017).
Daily chart
Above the daily chart, the RSI of 15 indicates that the sell-off is exaggerated. Thus, a prolonged break below the psychological support of $ 5,000 seems unlikely in the short term.
4-hour chart
The RSI on the 4-hour chart is creating a lower minimum, despite the lowest minimum in the price table, which marks the development of a bullish divergence. The divergence would be confirmed if the RSI continues to postpone the minima and the 4-hour candle closes in the green. This would open the doors to a corrective demonstration.
view
- The bearish weekly closing probably set the tone for a decline of less than $ 5,000. In the short term, however, BTC can defend that level of psychological support, courtesy of the oversold conditions on the daily chart.
- A small corrective hike of $ 5.800 could be in sight, but it could reinvigorate bears and bring a sustained decline towards the upside of long-term trendline support, currently seen at $ 4,100.
- A move above the previous resistance to support $ 6,000 would invalidate the bearish asset.
Revelation: The author does not hold cryptocurrency assets at the time of writing.
Image of the bitcoin chart using Shutterstock; Charts for Trading View
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