The Bitcoin ($BTC) price is on the way back down after recording the latest in a series of lower highs. Could this be a roll-over, down from the top of nearly $100,000, or is this just a period of consolidation and accumulation before going much higher?
Third successive downward day for Bitcoin
Around 2% down early on Monday, the Bitcoin price is on its third downward day since hitting $98,200, which failed to make a higher high. In fact, the $BTC price has been rolling over since almost hitting the all-time high on Friday 22 November.
We are now into December, and this slight downward trend has not been arrested yet. Could it continue, or will the U.S. Spot Bitcoin ETFs, Microstrategy, and all the various institutions adding Bitcoin to their treasury, force the price back up again?
Bitcoin price traverses inside triangle
Source: TradingView
The short-term time frame for $BTC is not showing signs of any heavy downside to come – at least not yet. The price is in a triangle, formed by the series of lower highs, but countered by the higher lows.
The price has fallen below the 0.382 Fibonacci for this latest move, and is currently heading down to the 5.0 Fibonacci. If it falls below this, the major Fibonacci supports of the 0.618 and the 0.786 await below. There is also the bottom trendline of the triangle to act as support.
Looking at the bottom of the chart, the Stochastic RSI is coming down to the bottom, and once the 8-hour and the 12-hour Stochastic RSIs also come down to their respective bottoms, the bounce would potentially be primed, if not already happening.
Could this next bounce have the impetus to break though the top of the triangle? Considering that Bitcoin usually does not wait until the end of triangles to break one way or the other, we should find out, once, and if, the price does get back up to the top trendline again.
If the $BTC price falls through the bottom of the triangle, all eyes need to watch for whether the price goes below $90,700. If this happened, it would register a lower low, and would break the upside trend.
Bullish hammer candle versus bearish Stochastic RSI cross down
Source: TradingView
Looking at the $BTC price on the weekly time frame, it can be seen that after the huge set of three green weekly candles, the price has now started to either roll over and down, or is consolidating before going higher.
The big factor in the bull’s favour is that last week’s candle has closed in the form of a hammer candle. This would often be found at the bottom of a downward phase in price, and would signal a trend reversal. However, if it forms during an upward price movement, it has the potential to signal a continuation of that movement.
That said, one of the factors that currently favours the bears, is that the weekly Stochastic RSI has confirmed a cross down of the indicators. This would normally signal that upside price momentum was leaving the market.
Be that as it may, there is still the chance that the 75.00 level could act as a support and help to turn these two indicator lines back around. The next few weeks will be very important in this regard.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
