Today was not a good day for Bitcoin.
And the same can be said for the rest of the crypto market. Following a bearish trend that has dominated the market since late June, the total market cap for the entire crypto biz contracted by more than 5 percent today.
Bitcoin broke below $8,000 and touched the $7,970 per coin mark, before correcting to around $8,050. It’s been fluctuating around $8,000 ever since, with tiny candles and low trading volumes.
With this decline, Bitcoin breaks the support it had in the $8,100 per coin zone. The last time this happened was on October 6 when BTC touched $7,800. From that moment on, the Bitcoin bulls took control of the markets, pumping the coin to $8,700 in a little less than three days.
Analyzing charts with candles set to one day, Bitcoin is still being trading sideways in the short term. However, the overall picture does not look very encouraging. Bitcoin is inside a downwards channel that would put up a resistance of close to $8,000 in the next few days, assuming it keeps the trendless pattern of the last two weeks.
The Relative Strength Index (which shows how dominant sellers or buyers are) is also going down, touching lows that—outside of the September 22 crash—have not been met since December 2018.
This means sellers want to get rid of their bitcoins quickly, which in many cases is taken as a sign of nervousness that can lead to a price hike when it’s over.
So when will this end? That is the key question.
If this channel holds strong, a bearish scenario would bring prices close to $7,200 before starting a bullish correction. The best-case scenario for traders could be an inverted Bart that puts the token close to $9,400 before achieving natural resistance. But that’s being very optimistic.