Price levels will likely see a breakout next week. Since the recent Drop from $11,000 to $9,800, price levels have created an asymmetrical triangle.
On the 1 hour Chart for XBT/USD, the asymmetrical triangle can be seen highlighted after the breakdown from the rising wedge. Price action is now trading sideways resting on the 200 EMA and looking poised for a drop back to POC (Point of Control) at $10,111.
We could see a break-down as bulls struggle to gain momentum. Large wicks that meet with selling pressure usually indicates the breakout is unsustainable and is essentially going to fuel a further drop.
Before forming a new uptrend Price levels might re-visit the 0.382 Fibonacci level at $9,650. Key resistance at $11,100 will likely be broken provided a clear bounce plays out at this price point, and this will result in a new short-term uptrend that will likely last for multiple weeks. A bearish indicator is that price levels are struggling to gain higher than the 500 MA at $10,800 is.
The 500 MA is seen cutting through the current market price on the 4-hour chart for XBT/USD. This indicates that within the last few months despite the volatile range created, Bitcoin has undergone a period of sideways consolidation. Bitcoin has created a lower low and the peaks are all within close proximity of each-other value-wise. Thus, sideways movement is seen. A volatile consolidation range of between $14,000 and $9,800 will likely be met with an explosive breakout.
Volume MA is currently trading around the all-time low for the visible chart time-frame. If volume levels don’t rise soon Bitcoin price will likely see another drop which could create a lower low on the 4-hour chart, anywhere between $8,800 and $8,100.
It’s wise to assume the trend is bearish if price levels drop below $8,100 and more caution must be adopted when taking long positions. For now, the sentiment is still bullish. It largely depends on whether or not enough volume will flood back into the market, quite like the volume levels seen throughout May and June through to July.
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