Bitcoin (BTC) Price Analysis: Oversold But Bearish Sentiment Remains
Bitcoin (BTC) Price Forecast, Analysis and Chart:
- October multi-month low may not hold.
- Strong support levels difficult to identify.
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Bitcoin (BTC) – Preparing For The Next Leg Lower?
We have warned over the last couple of weeks that Bitcoin (BTC) was looking weak and that a breakout from its restrictive range/s was on the cards. Various technical indicators have been flashing warning signals and on Thursday the market finally gave way and slumped all the way down to the $7,400 area.
The daily chart shows the short-term and long-term outlook for Bitcoin diverging with the market currently looking over-sold, using the CCI indicator. This may see prompt a short-term up tick, but the overall sentiment is still seemingly negative and with little in the way of strong support, lower prices are likely. The downtrend off the late-June high at $13,850 is now back in play after the recent break-out and if this trendline resumes its resistance, then BTC sentiment will remain negative.
The recent multi-month low on the October 23 candle at just over $7,300 remains the first level of support but a break and close below here could see BTC slide below $7,000 and back to the $6,400 - $6,500 area. We identified the death cross formation – 50-dma trading down through the 200-dma – a couple of weeks ago and it now looks likely that the 20-dma will drop below the 50-dma, highlighting the short-term weakness in the market. With Bitcoin trading available on a 24/7 basis, this weekend’s price action will be interesting to watch.
Bitcoin (BTC) Daily Price Chart (May – November 22, 2019)
IG Client Sentiment shows that retail traders are 86% net-long Bitcoin, a bearish contrarian bias.
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