- Bitcoin has fallen more than 25 percent in the third quarter, neutralizing the bullish configuration on the monthly chart.
- With the week and lists three days biased downward, the cryptocurrency risks falling to $ 7,500 in the short term. A violation would not expose the next major support, currently at $ 7,070.
- A corrective bounce can be before an extended sell $ 7,500 $ 7,070, such as 4 hours chart is reporting an upward divergence relative strength index.
- A break above down $ 9,049 July is needed to override the configuration of the low long lists.
Bitcoin (BTC) is flashing red again, after reaching a minimum of 3.5 months today and is on track to record the first quarterly loss of 2,019.
Top cryptocurrency by market capitalization fell to $ 7.715 at 04:50 GMT today – a level last seen on June 11 – and is currently changing hands at $ 7,980 in Bitstamp, representing 2 percent loss during 24 hours a day.
More importantly, the CTB is currently down more than 25 percent since July 1 Share price $ 10,759 opening. This is the first quarterly loss since the last three months of 2018.
At that time, the cryptocurrency had fallen by 44 percent, as seen in the table below.
- Winning run two quarters of Bitcoin is set to end a price drop double digits.
- 27 percent slide seen in the period from July to September is the second largest loss in the third quarter of history, the first being the 55.78 percent drop in the third quarter of 2011.
- Prices recovered 10.9 percent and 162.69 percent in the first and second quarters, respectively.
Technical charts long term had turned bullish after price rise three digits in the second quarter and many observers were convinced that the CTB can see a brief correction in the third quarter before challenging highs near $ 20,000 in the months late 2019 thee.
The cryptocurrency saw a decline of $ 9,100 in mid-July, after reaching a maximum of $ 13,880 in late June and marketed largely a side way around $ 10,000 in the next eight weeks.
Metric different prices as the rate of hash record levels, the CTB was expected to draw a strong rebound from $ 10,000. Instead, the cryptocurrency plunged below the psychological support last week and touched lows below $ 8,000, weakening the long-term bullish case, as seen below tables.
BTC created candelabra inside consecutive bars in July and August, signaling indecision in the market or consolidation.
red candle September marks a bearish follow-through consolidation. Essentially, vendors have won a hard tug of war with bulls.
The bearish reversal bar inside would confirm if the closing prices today (GMT) under $ 9,049 – the low of the first bar inside (July). BTC currently trading at lows below $ 8,000, a bearish closure is roughly confirmed.
The latest monthly candle has thrown cold water on the optimism generated by the fall of rupture April channel. Moreover, a similar break in October 2015 paved the way for a solid bull run two years.
The pessimistic forecast could be invalidated if and when prices rise above $ 9,049.
Weekly and 3-day graph
BTC closed well below $ 9,533 on Sunday, confirming a breakdown of double top in the weekly line chart (top left).
The breakdown has opened to $ 7,500 (objective according to the method of moderate motion). Supporting the downward-50 case is printing below the relative strength index (RSI).
Meanwhile, the three-day chart (top right) indicators are also reporting bearish conditions. For example, the RSI is hovering below 50 and the 5- and 10-candle are MAs south trend.
Further, the 5- and 50-candle MAs have produced a bearish cross and MA 10-candle is about to cross under the MA 50-candle.
With odds in favor of the bears, a drop to the MA-200 sail, currently flatlined at $ 7,070, it seems likely.
Daily and 4-hour graph
BTC could not get the 200-day MA on Saturday, as expected, and fell to a 3.5 months today.
Essentially, BTC created a high lower in the MA key, reinforcing the pessimistic view. The daily chart’s RSI continues to report oversold conditions, but would gain credibility if and when the seller signs of exhaustion emerge on the price chart.
However, on the 4 hour chart, the indicator is charting higher lows, which contradicts lower lows in price. That bullish divergence indicates a corrective bounce could be seen before the fall of $ 7,070 to $ 7,500, as suggested in the lists long-term.
Corrective rallies, if any, is likely to face strong resistance from the 200-day MA at $ 8,415.
Disclosure: The author does not hold assets cryptocurrency at the time of writing.
Bitcoin image via CoinDesk Archives; charts by Trading View