Bitcoin outlook: Falls sharply from new record high but larger bulls are still firmly in play

BTCUSD collapsed on Thursday (down around 5% into mid US session) after hitting new record high (124500) in Asia.

Bitcoin was deflated by comments from US Treasury Secretary who ruled out buying more BTC for the US strategic reserve, as government plans to rely more on confiscated holdings, rather than to purchase.

Today’s drop was the biggest daily loss since mid-June, which is on track to generate further bearish signals (completion of bearish engulfing pattern on daily chart and potential sixth consecutive failure to register a weekly close above psychological 120K level).

Near-term structure has weakened and keeps the downside vulnerable, although 200HMA (118K zone) has so far provided a temporary footstep, where temporary base is forming on hourly chart.

Larger picture, however, remains firmly bullish (action is underpinned by thick daily cloud / daily Tenkan/Kijun-sen in bullish setup and trend higher / positive momentum is still strong despite the latest weakening) and supports scenario of healthy correction before larger bulls regain control for renewed attempts towards recent record highs.

Res: 120000; 120573; 123261; 124500

Sup: 117500; 117030; 116622; 115850