What’s equally as harrowing is that there has been a large drop off in market volumes, signifying that bulls aren’t ready to pick up the slack, and shows signs of market indecisiveness.
But more importantly, the weekly candle has taken the form of a Doji, a special candle formation that is marked by a skinny body (similar open and close price) and long wicks, meaning that the asset in question traded in a large range. Dojis often signifies the end of a trend.
Yesterday, we reported that Bitcoin wasn’t looking all too hot. As pointed out by analyst Joe McCann, for the first time in four-odd weeks, BTC’s upward momentum has slowed dramatically, with the recently-closed candle looking rather skimpy. Or in other words, “the weekly chart is looking at bit out of gas for Bitcoin.”
This analysis proved to be correct, surprisingly enough. In the past 24 hours, Bitcoin has collapsed by some 8.5%, falling under $8,000 for the first time in weeks. And as seen below, BTC even briefly touched $7,850 on the back of a harrowing influx of selling pressure.
While some are convinced that this is a temporary reverse “Bart”, meaning that BTC may soon recover to the upside, this sudden collapse has elicited bearish (or at least cautiously optimistic) sentiment from a number of analysts. The parabola that Dave The Wave painted, which acted as support from December’s $3,150 bottom to now, has finally been broken.As to where, Bitcoin could head next, some have had some theories.
Josh Rager recently noted that with Bitcoin’s most recent candle on the daily chart closing bearish, down over 5%, he expects for the cryptocurrency market to continue to “push down quite aggressively.” In fact, Rager writes that if “bulls don’t step in” to reclaim a level like $8,200, he would be inclined to suggest that Bitcoin may reclaim a CME futures gap at $7,175, rather than rebound to post new year-to-date all-time highs.
$BTC – Daily close Bearish
Bitcoin continues to push down quite agressively and would like to see a move above $7824 and hold
Eyeing that previous CME futures gap that wasn’t explored at $7175
If Bulls don’t step in, I believe price is heading that way
— Josh Rager ? (@Josh_Rager) June 4, 2019
Bulls may get some short-term reprise, however. Bravado’s Bitcoin Jack recently noted that BTC could find some support in the low-$7,000s, which is where bulls needs to step up to the plate to regain control of the wheel. And as Rager adds, “due to the amount of volume, it’s more likely that price has short-term relief… before another push down to retest support.”
$BTC
People have asked if that was short term sell off and the price is heading back up
Due to the amount of volume, it’s more likely price has short term relief that can last hours or days before another push down to retest support
Price action isn’t a straight line ?
— Josh Rager ? (@Josh_Rager) June 4, 2019
