I was hopeful BTC was trading sideways but after the recent drop, it is clear we are in a downward channel. The chart above is a one-hour candlestick.
It might take something more than just market psychology to break this channel. The news out of China certainly dented confidence in Bitcoin, even if that will only cause a short to medium-term dip. The next potential fork in November will certainly see more volatility in the market, but without some positive news for the leading cryptocurrency, I expect to see a lot of investors hesitant to enter the market.
Is this reminiscent of the 2014 crash that took 3 years for prices to come back? It is certainly too soon to be making that comment. I am still bullish on Bitcoin and won't be selling my any coins at a loss that I currently own. But will trade short-term buying dips and selling highs.
Keep an eye out for support lines, I'll be watching closely to see if we can hold above the psychological support line of $3000, but before that there is a support line at $3250 and then at $2750. If prices drop below $2750, it may be hard times ahead.