Bitcoin suffered another leg lower and is down to the very bottom of its broadening wedge formation once more. A bounce off this area could still keep it on track towards testing the resistance, but a break lower could spur further declines.
The 100 SMA is below the longer-term 200 SMA to indicate that the path of least resistance is to the downside, but a crossover appears to be brewing. If completed, it could draw more buyers back in and allow bitcoin to recover to the wedge top around $3,900 or at least until the middle at $3,750.
Volume is still relatively subdued so there might be no imminent threat of a breakdown. Then again, traders might simply be sitting on their hands and waiting to see how price reacts to these current levels. Note that the previous year low around $3,200 is just close by.
Stochastic is still pointing down to confirm that sellers have the upper hand. This indicates that further losses could be in the works, possibly lasting by the same height as the megaphone formation.
Bitcoin has had a rough time in the past weeks as it broke below one key support after another. Buyers seem to be quickly running out of steam despite small upside breaks, signaling that optimism is still weak.
Some blame the rise in other cryptocurrencies like Tron as one of the factors weighing down on the more well-known coins like bitcoin and ethereum. After all, Tron is making progress with its BTT coin so traders might be moving some funds there instead.
Commentary has mostly sided to the bearish end and not surprisingly. After all, many are saying that bitcoin has yet to dip lower before seeing any chance of a big rebound this year. On the other side of the coin, hopes for institutional investment might keep losses limited.