Skip to Content
News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

Free Trading Guides
Please try again

Live Webinar Events


Economic Calendar Events


Notify me about

Live Webinar Events
Economic Calendar Events






More View More
Bitcoin Bloodbath: Prices Nearing Support, Is Relief in Sight?

Bitcoin Bloodbath: Prices Nearing Support, Is Relief in Sight?

To receive Michael’s analysis directly via email, please SIGN UP HERE

BTC/USD Daily Chart (Log)

Bitcoin Price Chart - Daily Timeframe

Technical Outlook: Bitcoin broke a multi-month consolidation pattern off the December record highs with an objective break of the monthly opening-range lows / slope support unleashing a 30% sell-off in prices. The decline has taken out confluence support at 11160 with a near-term confluence support-zone eyed at 8354-8729. This is the first major hurdle for the sell-off and IF price is going to rebound, this would be the spot to look.

New to Bitcoin Trading? Get started with this Free Beginners Guide

BTC/USD 240min Chart (Log)

Bitcoin Price Chart - 240min Timeframe

Notes: A closer look at near-term price action highlights a rebound today off the 61.8% retracement of the September advance at 9303 with price broadly trading within the confines of a descending pitchfork formation. Subsequent support targets rest just lower at 8643-8729 backed by 8337- both areas IF reached would be of interest for near-term exhaustion / long-entries. A break / daily close below this threshold would risk considerable losses with such a scenario targeting the 200-day moving average around ~7138.

Why does the average trader lose? Avoid these Mistakes in your trading

Interim resistance stands at 11160 backed by 11978 – and area of interest for re-entry on the short-side. Near-term bearish invalidation stands with the upper parallel at 13074- ultimately, a break above 15338 would be required to mark resumption of the broader uptrend.

Bottom line: the immediate decline is at risk as we approach near-term structural support with a rebound in price to offer more favorable short-entries targeting the aforementioned support targets. From a trading standpoint, look for signs of a near-term exhaustion low in price for the rebound - but ultimately looking lower.

For a complete breakdown of Michael’s trading strategy, review his Foundations of Technical Analysis mini-series

Bitcoin IG Client Sentiment
  • A summary of IG Client Sentiment shows traders are net-long Bitcoin- the ratio stands at +2.76 (73.4% of traders are long) – bearishreading
  • The percentage of traders net-long is now its lowest since Jan 2nd; Bitcoin traded near 14697
  • Long positions are 2.3% lower than yesterday and 13.7% higher from last week
  • Short positions are 39.9% higher than yesterday and 37.5% higher from last week
  • We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests Bitcoin prices may continue to fall. Yet traders are less net-long than yesterday and compared with last week. Recent changes in sentiment warn that the current Bitcoin price trend may soon reverse higher despite the fact traders remain net-long.

See how shifts in Bitcoin retail positioning are impacting trend- Click here to learn more about sentiment!


Other Setups in Play

- Written by Michael Boutros, Currency Strategist with DailyFX

Follow Michael on Twitter @MBForex or contact him at

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.