Bitcoin is one of the world’s most popular and most widely acceptable cryptocurrency. Recently, it enjoyed a flirt with its all-time high, but its current price area calls for caution, evoking the interest of technical enthusiasts. Is a 2017 Bitcoin Crash imminent?
13 March, AtoZForex – Every investor in the market wonders whether other drivers of bitcoin exist, other than demand and supply given the nature of its movement. Whatever the case is, determining its direction by looking at the chart is the technician’s preoccupation.
A peep at the bitcoin chart would expose to the technically savvy that the bulls have had a field time. However, ample technical evidences suggest bitcoin is on the brink of an imminent crash.
Reasons for a 2017 bitcoin crash
Looking at the bitcoin chart, one clearly sees a market that has been on the rise for the most part. Upon finding a bottom at the low of 171.26 after a corrective dip, it has maintained a steady rise. Though its rise to the all time high has been with less hitches, negative divergence is already indicating overbought situation. This ultimately has informed our caution that a 2017 bitcoin crash could be luring next. Interestingly, the divergence is visible across several frames. from the monthly, through the weekly, and to daily frame, it’s obvious.
More so, price actions on the different frames are bear supportive. For instance, January candle formed a doji. Although a new high was made, the loss of momentum negates a bullish continuation. And on the daily time chart, the story isn’t any different. Price gathering and the breakdown that followed is another pointer that the bulls game is up. The area of 1007.83 stands as the next immediate hurdle for the bears. This area lines up perfectly with 23.6% Fibonacci retracement drawn off the low of 171.26 to the high of 1176.46.
Another area of interest for the bears
A convincing break and close below 1007.83 region would have price tumble further. Another area of interest for the bears will be the next major support at 851.11 if 1007.83 gives way. In the very unlikely scenario of further price rise beyond the current all-time high, this view would be invalid. For the time being, our bias will stay bear supportive.
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