Within the last 24-hours Bitcoin (BTC) price dropped to a two week low at $6,468. The mild correction came right at the daily close and although the price traded most of the day between $6,780-$6,680, the downside move should be no surprise as a pattern of daily lower lows has been in play since April 10.
Crypto market daily performance. Source: Coin360
For some traders, the $6,666 meme has been something of a line in the sand and glance at the 4-hour chart shows the price has a tendency to wick down once this devilish level is pierced.
All humor aside, traders have been expecting a strong directional move since the price rejected around the $7,400 range on April 7, 8 and 9, and another signal was the daily decline in trading volume.
The price has also struggled to push above the 50-day moving average ($7,000) and below this level, $6,900 has been an especially difficult resistance to overcome.
BTC USDT daily chart. Source: TradingView
On the daily timeframe, there is a high volume node extending from $6,600 to $6,850 and this area had functioned as support since April 2. But yesterday’s dip to $6,468 now has traders eyeballing $6,400 and $6,200.
Knock out $7,250 or bounce at $5,800?
As has been thoroughly discussed in previous analysis and across crypto Twitter, a break below the $6,200 support increases the chance that Bitcoin price will revisit the supports in the $5,800-$5,400 area.
BTC USDT 4-hour chart. Source: TradingView
On the shorter timeframe, one can see that the price has dropped below the moving average of the Bollinger Band indicator. But while the $6,650 support has been lost, the most recent candlestick and increase in buy volume show traders bought into the dip. Though a 4-hour close above $6,763 is needed to rouse any hope that Bitcoin can reclaim the $6,900 to $7,000 zone.
The long-term descending trendline from the Feb. 13 high at $10,508 still looms overhead at $6,720 and aside from the 50-MA, Bitcoin price has struggled to sustain above the trendline.
Ultimately, not much has really changed with the market structure. The point of control is at $7,300 and a bullish outcome will require the price to push through the resistance zone at $6,900-$7,260 in order to take a shot at $8,000 at the 61.8% Fibonacci retracement level.
As discussed earlier, a bearish outcome entails the price dropping to $6,400, $6,200 and $5,800 where Bitcoin will have formed a double bottom.
Bitcoin daily price chart. Source: Coin360
The overall cryptocurrency market cap now stands at $190 billion and Bitcoin’s dominance rate is 64.2%.