- BTC/USD bulls are licking wounds under $3,800.
- More downside looks likely if the prices fail to recover shortly.
Bitcoin (BTC) broke above $4,000 only to crash spectacularly under $3,800 a few hours later. BTC/USD is changing hands at $3,779 at the time of writing, down 10% from the recent peak of $4,187. The inability to settle above critical resistance area after a breakthrough and develop a sustainable upside momentum bodes ill for Bitcoin bull, at least in the short run.
"What goes up must come down and that which pumps must eventually dump. That last sell-off is a sobering reminder that crypto is extremely volatile and high risk. Let's see if we can hold here $3,800 would be a nice place to build support, ”Matings Greenspan from eToro wrote in his Twitter account before the prices broke below $3,800 handle.
BTC/USD moved under DMA100 (currently at $3,780). Thus, now we are looking at $3,600, which is the next critical support for BTC/USD created by SMA200 (4-hour chart) and DMA50. Once it is broken, the downside may be extended towards $3,350-$3,300 congestion area.
On the upside, we need to see a recovery at least above $3,850 (SMA200, 1-hour). The next target is located at $4,000 and the recent high of $4,187.
However, considering the neutral position of the Relative Strength Index (RSI) and a lack of enthusiasm on the market after the sell-off, the bull might need some time to lick their wounds before another assault.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.