Bitcoin Cash's November 15 hard fork weighs on Bitcoin
The Bitcoin Cash's hard fork on November 15 is believed to be the major catalyst for the sharp decline in Bitcoin prices.
The BTC/USD, which has traded steadily in a wait-and-see mode since two months, broke the solid 61.8% retracement support on August - September recovery (see Figure 1) and shred nearly $1000 within hours. The pair stepped in the oversold market; the daily RSI slipped below 30% following the sharp drop, hinting that a correction could follow in the coming days.
Figure 1: BTC/USDT daily chart
However, the upside could remain limited due to the global lack of appetite in cryptocurrencies and the low trading volumes.
Traders should watch the critical $5978 resistance (major 38.2% retracement on November 15 drop, see Figure 2), which should distinguish between the consolidation of the negative trend and a short-term bullish reversal. But given the current mood, it is highly unlikely that $6000-offers give way to a positive breakout.
On the downside, the next important technical level stands at $5500 (August support).
-636779453164799280.png)
Figure 2: BTC/USDT hourly chart
Author
Ipek Ozkardeskaya
Swissquote Bank Ltd
Ipek Ozkardeskaya began her financial career in 2010 in the structured products desk of the Swiss Banque Cantonale Vaudoise. She worked in HSBC Private Bank in Geneva in relation to high and ultra-high-net-worth clients.
