[ad_1]
In my last article on 27th In November, I was neutral on Bitcoin (BTC-USD), as I expected that it would negotiate a box interval model for a week or two after which it would provide investors with a clear future direction. This came true because last week the cryptocurrency (COIN) yielded below the key support level at $ 3,845. This provided investors with a clear shorting opportunity, which in turn led Bitcoin trading below the "Cross of Death" to $ 3,500. So, because of this, I expect Bitcoin to have a further decline in the coming days. So, to determine the probability of this happening, I will look at the fundamental news concerning the cryptocurrency, while I will analyze the graph using technical analysis tools.
Key news:
Decision of SEC delays on ETF VanEck-SolidX Bitcoin:
The US Securities and Exchange Commission extended the period of revision of the Vancock Bitcoin ETF to 27th February 2019. This serves Bitcoin investors with a heavy blow because VanEck's proposal differed from other cryptocurrency applications. I say this because the ETF VanEck is totally dependent on Bitcoin itself, unlike other applications where ETFs depend on the futures market. So, in my opinion, this delay will cause a further drop in the price of Bitcoin as this is one of the greatest hopes that the cryptocurrency operators have had. This is how they believed that an endorsement of the ETF would have caused prices to rise in December.
Trade War:
The political climate between China and the United States is currently as tense as it may be. I say this because most investors did not expect President Trump to be hostile to the deal he signed with Chinese President XI Jinping. This is how the arrest of Huawei's CFO by the US intensifies tensions between the two sides. Furthermore, the situation worsened as China announced that it had arrested a second Canadian citizen. So, I think this will greatly affect the value of Bitcoin and other cryptocurrencies. This is the reason why most investors now want to invest their funds in more dependent and recessionary activities such as Gold. So I expect less money to flow into Bitcoin because of the tense political climate.
Slow growth rate:
I have no doubt that the technology behind the cryptocurrency market is amazing and has the potential to revolutionize world markets. However, I do not see this happening early and this is not a good sign for Bitcoin's current value. I say this as when the price of an asset becomes extremely low and shows no signs of recovery, so investors will sell naturally. Therefore, because of this, I expect the price of Bitcoin to continue its downward trajectory because it is currently a value that most investors will feel is not worth holding.
Cross of death:
In my last article on Bitcoin I highlighted the fact that the cryptocurrency is approaching its "Cross of death" point. This is basically when the price of a cryptocurrency decreases below the cost of production, which for Bitcoin is the price level of $ 3,500. The reason why I chose to highlight this is due to the fact that at the time of writing this article the Bitcoin is trading below $ 3,500. Thus, if the value of Bitcoin falls further, investors could expect a substantial decline in the amount of mining capacity allocated to the cryptocurrency. This in turn would trigger a sharper slide in the Bitcoin price.
Technical analysis:
Price history:
The price of Bitcoin since mid-November has been falling sharply, causing the cryptocurrency in the long-term support zone to plummet to $ 3.216. This is bad news for Bitcoin as it is now trading below its crossed price of $ 3,500. The bearish fall has begun due to the formation of the "Bearish Engulfing" candle model. The psychology of this candle model tells investors that the tide of the market has changed from that in which the bulls were temporarily in control of one in which the bears call the shots. Finally. the 20-day moving average acts as a falling resistance line, thus reaffirming my position that a bearish continuation is on the cards.
Daily chart:
The daily chart of the cryptocurrency indicates that in the coming days, Bitcoin will have a further decline. I say this as the currency has formed three consecutive bearish candles that exchange below the exponential moving averages. This indicates to investors that bears have the upper hand. Furthermore, it also shows that the overall trend of cryptocurrency is extremely bearish after being temporarily bullish in the interval pattern of previous boxes. In addition, the Bollinger band model has expanded in width, which indicates to investors that the trend is now decidedly negative.
On the front of the target price, I expect the Bitcoin to drop to the 61.8% to 78.6% range of fibonacci support levels. The Fibonacci support level of 61.8% is $ 3,078.3, while the Fibonacci support level of 78.6% is $ 2,886.5. However, if the cryptocurrency exceeds the 78.6% support level, I do not expect the fall to exceed the 100% fibonacci support level at $ 2,642.1.
The big picture:
In conclusion, I'm supporting the bears that are in the driver's seat. This notion is fueled by the fact that technicians and fundamentals support a descent into the value of cryptocurrency. However, whatever the way you decide to negotiate, make sure you use intermediate stops, as this will contribute to the preservation of capital that is paramount.
Good luck trading.
Thank you for reading my article. If you enjoyed reading the analysis, please, hit the & rsquo;Like it& # 39; button. Also, if you want to be informed about future articles, then hit & # 39;Follow& # 39; Link.
Revelation: I / we have no positions in any of the above mentioned titles, and we do not plan to start any positions within the next 72 hours. I wrote this article alone, and expresses my opinions. I'm not getting any compensation for this (other than Seeking Alpha). I have no business relationship with any company whose actions are mentioned in this article.
[ad_2]Source link
