Bitcoin, the world’s biggest cryptocurrency, recently burst out past a wide area of resistance in the $56,300-$56,700 range and soared as far as $59,680 until being pressured to retreat. There were signs that bearish sentiment was gaining traction in the short term, and we could see a drop to $58,000. Such a drop, or even one as high as $56,300, can be seen as a buying opportunity, with BTC aiming for $62,000 in the coming days.
Bitcoin 1-hour chart
The descending channel that BTC recently broke out of is seen in blue on the attached map. However, after rising to $58,000 and then to $59,300, BTC’s hourly chart showed a bearish divergence (orange).
As a result of the above divergence, BTC fell to $58,000. In reality, it only took 30 minutes for BTC to fall from $59,200 to $56,800 on that pullback (the long lower candlewick towards $57,000 on this chart), which was easily recovered. This fast decline may have been exacerbated by liquidations, which were then easily bought up.
In either case, at the time of publishing, the price was once again trending towards the $57,800-$58,000 demand range. Additionally, the cryptocurrency’s short-term technical indicators suggested increasing bearish traction on the market charts.
The bearish divergence on the hourly chart has already been demonstrated, and as a result, BTC has been reset in the short term. BTC was trading at $58,341 at the time of publication, just below the 50-period EMA (yellow). A candle close below this moving average would indicate any short-term market indecision, which might cause the cryptocurrency to fall to the $58,000 support level.
In light of the increasing bearish momentum, the RSI was also observed to fall below 50. The MACD developed a bearish convergence just above the zero level, and it which fell below zero to highlight the change in market momentum.
Finally, trading activity has been slightly smaller than average over the last few hours. This meant that, at least for the time being, the vendors did not have a monopoly on the market.
Although a drop to $56,300 cannot be ruled out in the short term, these will be opportunities to purchase the dip because BTC’s long-term structure remains intact, with the crypto expected to move towards $62k-$63k as a goal in the coming days.
246 Interactions, 6 today