Why is Bitcoin dropping? Panic has beset the crypto market, but what can the latest Bitcoin technical analysis reveal about Bitcoin price right now as bears gain a grip over BTC price action.
Happy New Year! Bitcoin
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Price
Trading volume in 24h
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Last 7d price movement
entered like a beast, gaining 10% and immediately after losing 7%. Is the market still bullish, or did the trend just turn bearish? It was quite the entry into the new year! Lots of over-leveraged traders got wiped out – liquidated.
Others took losses, and probably some still hold onto their positions, believing in the bullish thesis. Moves like these give good technical analysis data to look at, so let’s unpack it!
Bitcoin versus gold – rocket launch #5 has been delayed due to turbulence above the launch site pic.twitter.com/TUpK6lR38t
— Northstar (@NorthstarCharts) January 8, 2025
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Bitcoin Technical Analysis: Bullish Or Bearish – To Trade Or Not To Trade
(BTC/USDT)
As usual when doing technical analysis, we first look at the higher time frame – 1D. I purposely zoomed out until Dec 2023, so we can see how similar of a pattern price formed last month. Both Decembers formed ascending channels, and both broke down. And the 6-month-long descending channel in between was an accumulation that broke to the upside.
I’ve taken the purple box as an area of interest, as it is untested territory. Because price broke below the MA50 (white), that box aligns with the MA100 (green), from which the uptrend resumed in January 2024.
(BTC/USDT)
Moving on to 4H, what immediately catches the eye is the strong rejection at $102,000 and a full retrace of the pump we witnessed just two days ago. The bullish outlook quickly turned bearish.
Is this death for bulls and victory for bears? Looking closely, we can see that there was a retrace of the trend line, which was a good trigger to enter a short position at around $99,000 and close with good profit at the support level. On this timeframe, the price is now below all the MAs we monitor.
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Last but not least – 1H. Bulls don’t like what’s happened here. This quick sell-off / retrace of the pump looked promising until none of the MAs could act as support.
Even though the RSI shows bullish divergence, it would be best to wait for the RSI to drop a bit lower on the higher timeframes before entering longs again. Or until we see MAs reclaimed and retested. Until then – bears are in control.
Concluding Thoughts on Bitcoin Technical Analysis
Me personally, I would wait for the Bitcoin price to settle and find support – ideally around the levels I pointed out in the 1D chart. Finding a bottom of around $85,000 could become a strong base for launching the next leg up.
Breaking below $68,000 would mean the uptrend is over. It’s a long way down, and it is very unlikely for the price to go that low, considering the constant ETF inflows. Anything can happen in the markets, though, so always manage your risk and protect your capital!
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The post Why is Bitcoin Dropping: Bulls And Bears Clashing Over BTC Price appeared first on 99Bitcoins.