Bitcoin Chart Indicator Flips Bearish as Price Sees Weak Bounce From $9.4K

Bitcoin’s lackluster restoration from value assist round $9,400 is struggling to collect upside traction amid bearish developments on the short-term technical charts.

The
high cryptocurrency by market worth fell by 5.5 % on Wednesday to register
its largest single-day drop in three months.

Sellers, nonetheless, did not hold costs beneath the extensively tracked 200-day shifting common assist on the four-hour chart (at present at $9,400). That stage was defended once more on Thursday.

To date, nonetheless, the repeated protection of that stage has did not yield a notable value bounce, leaving the cryptocurrency beneath the resistance of the five-day common at $9,750.

A major restoration might stay elusive, because the every day chart’s cash circulate index (MFI), a momentum indicator that includes each value and buying and selling volumes, is suggesting elevated promoting stress with a below-50 studying.

The MFI dropped beneath 50 on Thursday and is at present seen at 43.00, the bottom stage since Jan. 2. Because of this, the dangers are skewed to the draw back.

At press time, bitcoin is altering fingers at $9,710 on Bitstamp and its world common value, as calculated by CoinDesk’s Bitcoin Value Index, is seen at $9,721 – up 0.87 % over 24 hours.

The MFI (above left) has discovered acceptance in bearish territory beneath 50, validating a significant bearish engulfing candle created on Feb. 19. That candle additionally established a decrease excessive (marked by arrow) at $10,300 – an indication of weakening bull momentum.

The five- and 10-day averages are trending south, additionally indicating a bearish setup. Notably, the cryptocurrency is struggling to penetrate the five-day common, as indicated by the higher wick hooked up to right this moment’s candle.

Additional, bitcoin is buying and selling inside a descending bearish channel on the four-hour chart (above proper). So, a deeper slide to $9,075 (Feb. four low) can’t be dominated out.

A sustained break above the five-day common at $9,755 would neutralize the bearish bias. That stated, the market would solely flip bullish if costs handle to exit the falling channel on the again of robust volumes. In that case, the latest excessive of $10,500 would seemingly be put to check.