View
-
Bitcoin tanked by $1,702 early on Friday, the biggest intraday drop since January 2018.
-
On the way back up, the hourly chart shows scope for re-test of former support-turned-resistance at $7,619.
-
A bounce to $7,619, if any, could be short-lived with prices falling back to $6,178 (daily low) over the weekend, as both the 4-hour and daily charts are biased bearish.
-
A bounce from the historically strong support of the 30-day moving average (MA) at at $5,986 would imply an end to the price pullback.
Amid extremely overbought conditions, bitcoin has fallen by $1,702 – its biggest intraday price drop since January 2018.
The cryptocurrency market leader nosedived from the day’s opening price (UTC) of $7,880 to a seven day low of $6,178 on Bitstamp in the Asian trading hours.
The $1,702 drop is the highest since January 17, 2018, according to Bitstamp data. On that day, BTC had tumbled by $2,171 from the opening price of $11,393 only to recovery all the way back to $11,191 by UTC close.
Litecoin Price Hits 11-Month High Above $100
Bitcoin has recovered more than 50 percent since the low hit earlier today. However, just before press time, its price is still down around 8.2 percent on the day at $7,223.
The sell-off seen today doesn’t come as much of a surprise, as the widely followed relative strength index (RSI) has been reporting extremely overbought conditions with a near-90 reading earlier this week.
Buyer exhaustion was also evident from BTC’s repeated failure to hold onto 10-month highs above $8,300, as seen in the last 72 hours.
What’s more, many in the investor community had associated BTC’s recent rise with Blockchain Week NYC and Consensus 2019. The cryptocurrency, therefore, was perhaps vulnerable to “sell the fact” pullback.
Bitcoin Faces Price Correction Toward $7.6K, Technical Charts Suggest
A massive unwinding of long BTC/USD positions (profit taking) was seen in the 120 minutes to 04:00 UTC, according to data tweeted by bot powered twitter handle @WhaleCalls. Further, some are saying online that a major sell order from one party may have triggered the downward move.
Looking forward, a minor bounce could be seen in the next 24 hours before a possible fall back to levels below $7,000.
Hourly and 4-hour charts
On the hourly chart (above left), the relative strength index (RSI) has bounced up from oversold levels seen earlier today, suggesting scope for a recovery toward the former support-turned-resistance of the double top neckline at $7,619.
That resistance, however, may cap upside and reverse any price bounce, as a bearish crossover of the 50- and 100-hour moving averages (MA) is almost confirmed.