Bitcoin price dropped once again under the $10,000 level in a move that is only considered as consolidation at the moment but that might well turn into a bearish pattern.
This recent rally started on 19th June and in one month it saw the top cryptocurrency going from as high as $13,880 on 26th June to a low of $9,050 of 17th July.
High volatility in between, with the joy of day traders that could take reasonable profits following their favorite technical analysis.
Next levels of support are $9,600, $9,300 and $9,000 as a few signs indicate a bearish trend for Bitcoin and crypto markets after clearly facing rejection at the $11,000 level. Basic technical analysis is showing that BTC is trading in a “selling pattern.”
Price and volume analysis both suggest that the price might drop down as low as the $8,500 area.
Another bearish sign is represented by the RSI that has been unable to recover to levels above 70 after the drop on July 21.
The Relative Strength Index (RSI) measures the speed and change of price movements. It oscillates between zero and 100 and traditionally it’s considered overbought when above 70 and oversold when below 30.
On the fundamental side of the analysis, various reasons might be behind the bearish momentum but India’s possible ban on cryptocurrencies is in everyone’s eye. Strong voices are rising against the country’s impelling ban which, by the way, was confirmed in a recommendation report the Indian government released yesterday.
Investor Tim Draper spoke out recently against the news in a very passionate tweet although the ban is still controversial at the moment with some claiming cryptocurrency cannot be banned.
Changpeng Zhao, CEO of Binance in the aftermath of the news declared that ‘cryptocurrency does not depend on “any one country” to thrive. “Cryptocurrency will survive regardless of any one country. Most countries that try to ban bitcoin cause their citizens to want cryptocurrency more,” Zhao continued.
For a bull confirmation, we need to see the price back to $12,000.
At the time of writing, Bitcoin price is back above the $10k region, trading between $10,050 and $10,147. Market Cap of $180B is the lowest it’s been in a month ($232B) and volume ($17B) is one-third of what it was when BTC was at its recent higher price of $13,880 (vol. $45B) on 26th June.