Bitcoin (BTC) Price Analysis: Approaching Line in the Sand for Bulls
Bitcoin could be in for more losses as it fell through the bottom of the longer-term triangle consolidation visible on the daily time frame. This could mean that further declines are in the cards, although price could still bounce off the line in the sand for bulls around $5,800.
A move below this key support area could pave the way for a longer-term slide, possibly lasting by the same height as the chart formation. this spans $5,800 to around $10,000. The 100 SMA is below the longer-term 200 SMA to indicate that the path of least resistance is to the downside or that the selloff is more likely to gain traction than to reverse.
Stochastic is on the move down and has room to slide before hitting oversold levels, which suggests that selling pressure could stay in play for much longer. RSI is also heading lower and has yet to indicate oversold conditions but seems to be turning slightly higher. In that case, buyers could return soon, but probably hit a ceiling at the broken triangle support near $6,400.
Bitcoin has been hit on almost all fronts in the past few days, with regulatory developments not looking in favor of a SEC approval on pending bitcoin ETF applications. Earlier on, the IMF warned of cybersecurity risks related to cryptocurrencies then stressed the need for oversight while the FSB highlighted the inherrent weaknesses of bitcoin that prevents it from being a major threat to stability.
The SEC has also been busy cracking down on potentially fraudulent activity involving ICOs, which suggests they might be heavier-handed in tackling crypto products. Also, the Congress hearing on bitcoin and blockchain features a testimony by Nouriel Roubini, who has been dubbed Dr. Doom for predicting the 2008 financial crisis. He is also very critical of bitcoin and has repeatedly mentioned that it is in a bubble.