December 8 was a bad day for Bitcoin. The world’s largest token in terms of marketcap finally broke down, losing all the profits it had gained since November 29, 2020.
Over the past few days, the $19,000 line became a kind of war zone, with Bitcoin going up and down that price line with no clear dominance of bulls or bears.
However, things changed on December 8, 2020. At 6am UTC, the token had a quick dip from $19299 to $18798 in just 3 hours, with a minimum of $18680. BTC was unable to recover from the fall-out for the rest of the day, although it did manage to remain stable during the next hours.
But the bears were barely resting, and at 22:00 UTC, they gave their final blow, dumping the price from $18771 all the way down to $18340 in less than one hour. The next two hours brought the price down to $18138. After that, the price managed to correct a little.
By the time of writing this article, Bitcoin is trading at $18275 for a 24-hour loss of 4.68%, according to Coinmarketcap.
The crash of Bitcoin was a significant blow to the crypto markets. In just one day, the global marketcap lost $35.14 Billion, of which $19.1Bn was from Bitcoin alone.
Day Traders Need To Be Cautious As Charts Show Mixed Signals
Things aren’t looking good for scalpers and day traders. The token is below the lines of the Exponential Medium Averages used to determine short-term trends —in other words, the current price is lower than the expected price— and the MACD still shows a bearish signal.
However, during the last few hours, Bitcoin’s price managed to recover a little, rising from a low of $18005 to almost $18300 today. The sharp drop in prices also allowed the RSI to sink to levels similar to those of November 2020 when a sharp fall was followed by a significant Bullrun, with BTC going from $16000 to ATH in days.
Such a low RSI could point out to a major overselling, possibly due to FUD, a panic episode, or a lot of stop-loss orders being automatically activated. If this is the case, those who bought Bitcoin for cheap could start pushing for a spike later on —at least in theory.
Bitcoin Hodlers Can Remain Calm… For Now
So, swing traders, hodlers and those operating in more extendend timeframes, can still remain calm. Charts still show a Bitcoin on a bullish channel, with a balanced RSI (which means there’s no clear dominance of bulls or bears).
Bitcoin would need to move beyond $18495 to stay in the bullish channel that began in late September. If it gains enough momentum to get back on track, a new ATH could be on the horizon.
If it fails, it could even plummet to $15600 and retake the slow but bullish channel that it had already embarked on in March, right after the pandemic crash. This bullish trend became more pronounced with the announcements of Square, PayPal, and MicroStrategy along with a major recognition from analysts, institutions and governments.
Source: Crypto Potato