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Bitcoin – The Bears are Back in Town

Bob Mason

Bitcoin fell by 1.86% on Saturday, following Friday’s 0.96% fall, to end the day at $7,573.9.

A promising start to the day saw Bitcoin move through to an intraday day high $7,685 to come within reach of the day’s first major resistance level at $7,693.67 before easing back through the day, the relatively range bound day seeing Bitcoin steer clear of the day’s major support levels until a sell-off at the end of the day.

Bitcoin slipped through the day’s first major support level at $7,540.27 and the second major support level at $7,465.23 in the final hour to an intraday low $7,450. The 23.6% FIB Retracement Level of $7,605 and 38.2% FIB Retracement Level of $7,497 provided little to no support in the sell-off, with the moves late in the day seeing Bitcoin resume its extended bearish trend formed at early May’s swing hi $9,999.

Negative news was attributed to the slump that saw Bitcoin cough up $338 in just a couple of hours, with U.S regulators hitting the largest of the exchanges with subpoenas, as they continue to investigate price manipulation in the background. News of South Korean exchange CoinRail will have also had an impact, though to a lesser extent, with Bitcoin’s sideways moves through much of the day leading to a sell-off on the news from the U.S.

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At the time of writing, Bitcoin was down 2.49% to $7,311.8, in what’s been a particularly bad start to the day, Bitcoin falling through the day’s first major support level at $7,387.6 and second major support level at $7,301.3 to an intraday low $7,266.4 within the first hour, the late Saturday sell-off spilling over to this morning.

Moves at the turn of the day reaffirmed the resumption of the extended bearish trend, with Bitcoin at risk of falling below $7,040 to strike a new swing lo should market sentiment not improve through the remainder of the morning.

For the day ahead, a move back through day’s first major support level at $7,387.6 would be needed to support a run at $7,536 3 that would bring the day’s first major resistance level at $7,622.6 into play, while the 23.6% FIB Retracement Level sits some way off at $7,738 and likely to remain out of range for the day.

A breakout from the 23.6% FIB Retracement Level is going to be needed to form a near-term bullish trend and the lack of momentum through the week certainly contributed to the weekend reversal, which suggests more could be on the horizon, particularly as regulators step up their investigations.

Failure to break through the day’s first major support level at $7,387.6 could see Bitcoin take a second hit later in the day, with any pullback through the day’s second major support level at $7,301.3 bringing sub-$7,000 levels into play in the week ahead, while we would expect the day’s third major support level at $7,066.3 to be left untested through the day.

Elsewhere in the market, EOS was amongst the biggest losers, down 6.55%, with Monero down 5.13%, none of the majors in positive territory through the early part of the morning.

BTC/USD 10/06/18 4-Hourly Chart

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This article was originally posted on FX Empire