Bitcoin (BTC) Price Analysis: Closing in on Major Support Zone
Bitcoin had a pretty steep drop in the past 24 hours, taking price close to the long-term floor around $6,000 once more. A bounce off this area could lead to another test of nearby resistance levels or even stronger bullish momentum as many are hoping to buy on dips.
The 100 SMA is still above the longer-term 200 SMA to confirm that the path of least resistance is to the upside. In other words, the uptrend is more likely to resume than to reverse. However, price has fallen below the moving averages to reflect a bit of bearish momentum.
RSI is indicating oversold conditions or that sellers are feeling exhausted, and turning higher could encourage buyers to return. Similarly stochastic looks ready to pull up from oversold levels and reflect a return in bullish momentum.
Bitcoin has had a rough ride in the past few days, owing mostly to a set of negative updates. For one, it has been reported that Goldman Sachs might ditch its plans to offer a bitcoin trading desk. Although this was dismissed as “fake news” by its CFO during a speech, the remarks weren’t enough to restore investor interest.
Reports that ShapeShift is adding registration requirements and that Kraken is planning layoffs and a shutdown in some operations also fueled the bearish fire. Kraken also dismissed these rumors but bitcoin was unable to pull up significantly.
Traders could return their focus to pending bitcoin ETF applications from here, although the sentiment has been dampened recently. Recall that the SEC is also reviewing its earlier decision to reject a few applications but has not specified when the review period would end. A positive decision may be what bulls are hoping to get in order to sustain the anticipated rebound for the year.