Hello everyone!
It's been a long while since I've checked Bitcoin charts -- didn't realize it's almost been 3 weeks until I checked -- so it's a good time to revisit this and see what has happened since.
Here's the latest snapshot of the daily chart on BTC/USD, courtesy of TradingView.
The last time I posted my analysis on BTC/USD, I noted the resistance on $11,500. At that time, this level had rejected the upward momentum a second time, and I noted the importance of this resistance level. This still stands today. As we can see from the chart above, the level has not been tested again since. Instead, we see a move lower, breaching the key $8,000 support. It certainly appears we are headed to test the $6,000 major support level once again.
What has been causing the weakness?
According to CNBC, the selling may continue as "first-time investors realize they need cash to pay capital gains tax." Another factor may be because several countries "have stepped up their scrutiny of cryptocurrency trading in the last few months."
On the other hand, Bloomberg has attributed the ongoing weakness to mounting regulatory pressure in the cryptocurrency space, as well as having several social media platforms such as Facebook, Twitter and Reddit, distance themselves from cryptocurrencies. Another reason for the weakness may have to do with the ongoing "sales of Bitcoin held by the trustee of Mt Gox, the now-defunct Japanese exchange."
With all the issues in the horizon, it is hard to imagine Bitcoin returning to its bullish stance anytime soon. Hence, it is quite possible that we will continue to see selling pressures in the near future.
As always, trade carefully everyone!
Risk Warning: All comments, charts and analysis on this post are purely my own and should in no way be treated as recommendations or advice, nor should they be construed as an endorsement or recommendation to buy, sell or hold. Please do not trade based solely on the information provided on this post. Furthermore, past performance does not guarantee future success. Always do your own due diligence and analysis when trading.
