Bitcoin Price Analysis

[arvinabeabe]

The below chart shows the weekly Bitcoin price action on the left and the daily Bitcoin price action on the right. A bearish engulfing occurred in the weekly candle from last week. A bearish engulfing typically occurs after some upward movements, and reverses all of the previous candle’s upward movement, engulfing the candle. This is a strong bearish sign, however, we have failed to see a strong continuation this week, with the price of Bitcoin trading tightly around $6300 to $6400. A brief drop occurred, and the price hit $6100 but the quick recovery showed that investors are not yet ready to accept such a low valuation.

The daily chart shows the descending triangle pattern which has been in play since January. The pattern has been respected multiple times since it started forming in January, giving it increased legitimacy. The pattern would indicate price is set to return to sub $6,000 levels and undergo a sharp drop below this mark. In the nearer term, we may see another move upward to touch the downward trendline forming the pattern. An upward move is likely to meet extreme levels of resistance around the $6800 to $7000 marks.