Today Bitcoin had a really lackluster day. To be fair, most digital assets had a fairly lackluster day with a lot of small loses across the board. The currency basically started the day down, only to run back up, giving quick traders a nice run for quick profits. After pulling back a bit, Bitcoin leveled out around the $6300 area, ending the day around $6315.
The long term outlook for Bitcoin is still hazy. Although it recently had a large sell off, the price has held support of $6100. This seems to be the near term support with $5300 coming in below that. The pattern still looks like a descending triangle which is normally a bearish continuation signal, but with MACD rising we may see something different occur. This could be in the form of a rounded bottom pattern which takes a longer time to develop and is a reversal pattern.
The short term look for Bitcoin is possibly a bear flag. So we may see more downside movement. Could this retest the mid 5000s? I don’t see why not. With investors as skittish as they have been and competition ramping up, as well as random news from regulatory bodies and banks, almost anything can come out to spook investors and send the price dipping further. Still there are technicals to play here.
Short term traders can look for a break above $6500 for a run to $7500 or so. A break above $7500 and a trader can add more position to see if we break 8k. A move below $6100 and traders should look to see how the mid 5000s are digested. Parabolic dips can be bought off of panic selling as they should rebound, but may not hold for days only hours. For longer term traders, a test of the mid 5000s would be a great entry so long as it holds.