Bitcoin (BTC) Price Continues to Slide with Sell Signal Flashing
For the first time since April, the GTI Vera Convergence-Divergence indicator for Bitcoin is flashing a ‘sell’ signal, indicating a strong possibility of further losses for the coin.
The GTI Vera Convergence Divergence indicator is a trading instrument used to measure positive and negative trends in financial assets. While Bitcoin is still faring well on a monthly basis, it has now recorded losses three days in a row – a common sign of an impending trend reversal.
Yesterday evening the Bitcoin price lost support above $8,000 and dropped sharply to a low of $7,592.67 within a few hours. It then traded briefly in the $7,600 range before dropping a second time to $7,455.32. It has since managed to climb back to the $7,800 range but analysts are skeptical about whether it can hold the level.
What are the traders saying?
Last week saw many calls for Bitcoin to break the significant $9,000 level but now it seems such hopes have been dashed – at least in the short-term. A twitter trader by the name Chronis Trading (@BigChronis) outlined a chart showing a potential downward trend for Bitcoin over the next few weeks. If is analysis pans out as predicted, we could see BTC hit $6,400 by early July, the level at which BTC/USD traded most often during last year. It’s not all negative though, as Chronis Trading does foresee a decent upside correction following the dip.
Popular crypto voice Blockchain J (@Blockchain_Jay) has pointed out the anomaly that Bitcoin SV (BSV) is the only asset trading in the green following earlier threats by Craig Wright that he will dump more of his Bitcoin. The data certainly seems to indicate that a large transfer of assets from Bitcoin into Bitcoin SV could be precipitating this current drop. On the plus side, if that is the reason then it means it should only be a temporary correction.
The BTC/USD trading pair has definitely entered a short-term downtrend, with several signals now putting the asset in a sell position. 20-, 10-, and 5-day moving averages now indicate further losses in the immediate future, with the MACD also in bearish mode.
If Bitcoin finds support above $7,500 it could bounce back up to prior resistance at $7,930 in the short-term. Failing that, a fall through $7,000 would likely only find strong support at the previously mentioned $6,400 level.