Bitcoin price analysis: Cryptos sell off on fear of heights

Bitcoin closed drawing a long-legged Doji candle, a trend-swing pattern
CME and NASDAQ expected to get in the market, still lots to play

Tomas Salles FXStreet

Bitcoin closed yesterday’s European session hinting some potential for a technical sell-off, and so it happened. All the alarms were triggered after an evening star appeared in the BTC/USD 1H chart. A first bearish run saw the Bitcoin price falling to $10560, which was followed by an aggressive pullback that returned the price to levels close to the recent all-time highs. That was a textbook bull trap that left lots of buyers lost in the top of the wave.

Yesterday’s price action was really volatile throughout the day in the main Cryptocurrency, with price breaking out and experiencing swings larger than 30% of the opening price. After the sell-off, Bitcoin tried to recover $10000 but it failed doing so. That was a crucial level to get before the daily close, and by not getting it, doubts are mounting about another potential bullish ride in the coming days.

BTC/USD 1H Chart

In the daily chart, Bitcoin price has drawn a long-legged Doji candle, a trend-swing pattern. Bitcoin price will keep the bearish pressure until it unsettles this candlestick pattern with a daily close above $11442.

Despite that bearish overnight move, indicators continue to show bullish potential, with MACD open to new uplegs. In the Directional Movement Index (DMI), D+ is still moving above ADX with ease, while D- is not showing any kind of selling interest.

The contradiction between candlestick price action and indicators might require some time to clear out. In the very short-term, indicators are in rather neutral positions, which might be indicating a BTC/USD consolidation period after insane volatility experienced yesterday.

In the short-term, the Bitcoin 4H chart buyers still are overmatching sellers. MACD is crossed down low and with some room to slide down to neutral levels, which hints some bearish potential. While the daily technical formation doesn’t disappear, the most probable scenario is a bearish continuation move.

BTC/USD Daily

Conclusion

Resistance levels to watch in the upside are the all-time highs that were set yesterday. Only by breaking above $11142 will the bearish structure be dismantled. In the downside, the most meaningful support will be yesterday’s lows at $9135, which match the 23.6% Fibonacci retracement on the uptrend started last July. If that support is broken, there are not many safe spots in a bearish run until the $7800-$8100 zone.

Today, NASDAQ has shown interest in the developing a derivative product linked to Bitcoin, as CME will be launching in the coming days. Moreover, Goldman Sachs has included the main Cryptocurrency in its Commodities list. All these market giants are now conceding that Bitcoin has a long and eventful life to live.

¿Bitcoin is dead? Long live the Bitcoin.

Author

Tomas Salles

FXStreet

Tomàs Sallés was born in Barcelona in 1972, he is a certified technical analyst after having completing specialized courses in Spain and Switzerland. He expanded his technical training following the guidance of great experts on the financial markets.

AUD/USD falls to near 0.7100 after slipping below 50-day EMA

AUD/USD depreciates after registering minor gains in the previous day, trading around 0.7120 during the Asian hours. The technical analysis of the daily chart shows the pair consolidating sideways within a rectangle pattern, as neither bulls nor bears gain control. The AUD/USD pair is holding a slight bearish tone however as it sits beneath both the nine-day and 50-day EMAs.

160.00: USD/JPY back near intervention territory after upbeat US jobs report

US Nonfarm Payrolls beat expectations by a wide margin in May, with 172K jobs added. The US Dollar rebounds after the release, helping USD/JPY recover from its intraday lows. Warnings from Japanese authorities continue to limit upside potential near the 160.00 threshold.

Gold targets $4,300 amid stronger Dollar

Gold faces increasing selling interest and navigates the area of three-month lows near the $4,300 mark per troy ounce on Friday. The precious metal’s decline comes as traders assess the stronger-than-expected NFP, while the bid bias in the Greenback and higher US Treasury yields also collaborate with the retracement.

Cardano hits five-year low even as Hoskinson clarifies "break" isn't an exit

Cardano (ADA) price is down 10% at press time on Friday, extending losses over 30% so far this week amid Charles Hoskinson's clarification that "break" isn't an exit.

Week ahead – Fed countdown begins amid US inflation data and geopolitical risks

Fed Chair Warsh’s first meeting approaches as key US inflation data could reshape expectations. Oil prices remain elevated as US-Iran talks continue; tariffs also return to the spotlight. ECB is expected to hike; will it be a one-off move or is July live?

The US economy defies the rules: 100 days into the Oil shock and the recession signal is still missing

More than three months after the start of the Iran war and the resulting disruption to global energy markets, the US economy continues to display remarkable resilience. The conflict has triggered a sharp rise in Oil prices, reignited inflationary pressures and fueled widespread concerns about a potential economic slowdown.