After a nice little breakout last week, the bears made it clear that they still had some selling to do. Prices retraced to -1% below the previous breakout point leaving a lot of traders in the crypto space scratching their heads. Let’s do some price analysis on the 4hr chart, and read on to the end for an interesting fundamental teaser.
Many traders that entered the breakout trade last week and did not take profits are finding themselves at a deficit, so where to go from here? Interesting enough the price action has been trying to rejoin the previous bearish trend, but we are seeing some decent buying pressure around that area.
There is a small divergence starting between the momentum and the price action, a nice technique that traders employ to try to predict future price movements. I would like to add that the RSI is well below 50 on the 4 hour chart so I would not get too excited as it is still bearish on the shorter term. We need to be patient while the market shows us the next move.
There is also a possible morning doji star forming, depending on how this current candle will close, higher risk traders will certainly be looking at the Bitcoin market considering all the above mentioned.
Should prices fail to break above the current short term resistance at $6300, the market could experience another drop to test the immediate support at $6250. Should we break below this support level it is important to keep an eye on the momentum and the volume to determine whether there will be a bounce or further decline to test medium term support around $6000 – $6200.
This is just my opinion and is not backed up by any data, as there most likely is none to back it up.
OTC (Over The Counter) trading is a part of the Cryptocurrency ecosystem that is not often mentioned or understood by many in the space. This kind of trading is usually between certain individuals or companies, and naturally the data for this is strictly private and not available to the public.
There are some websites that facilitate OTC trading and the community does indeed have access to these, but I believe this is really a very small drop in the OTC ocean. At the moment some experts suggest that over 50% of the current volume for the Bitcoin market is on the OTC market.
What does this mean for us traders? Well it simply means that the public api does not represent all the trading volume in the world, keep that in mind when doing your technical analysis.
Feel free to join our trading community on Discord to discuss any crypto trading ideas. Safe trades!
- This reply was modified 6 months, 1 week ago by CheesePuff.