BTCUSD Price Technical Analysis: What’s Up With That Drop?! BTCUSD recently made a very sharp drop, breaking below the support of its ascending channel visible on the 1-hour chart. This signals that a reversal from the uptrend is in order, provided that the correction levels keep gains in check. Applying the Fib tool on the latest swing high and low on the 1-hour time frame shows that the 61.8% level lines up with the broken channel support near $720. The 50% Fib level is at $767 and the 38.2% Fib level is closer to $700, which is a major psychological level at which some sellers might be waiting. The 100 SMA is still above the 200 SMA on this time frame so the path of least resistance is to the upside. However, a downward crossover may be looming so bearish pressure could get stronger, possibly bringing BTCUSD back to the swing low around $670. Stochastic is moving out of the oversold zone to indicate a potential return in bullish pressure, which supports the idea of a correction. Similarly, RSI is heading out of the oversold region to show that buyers are taking control as well. A larger rally could place bitcoin price back inside the channel, which could mean that the uptrend is resuming. Reports that the Chinese government is considering imposing restrictions on bitcoin trading weighed heavily on BTCUSD price. Recall that the surge in investor activity from China was mostly responsible for driving bitcoin price up in the past few months as traders are seeking to hedge against yuan devaluation, so limiting this activity could force price to retreat. Still, the dollar remains one of the weaker currencies these days in light of major event risks. The FOMC statement has passed without much incident as the announcement […]
