As the global stock market continues to decline, Bitcoin (BTC) traders are trying to keep the price above the support of $ 7,800. Just a few hours ago, the Dow Jones closed down more than 1,400 points and the S&P 500 lost 4.89% after the World Health Organization (WHO) officially declared the Corona virus as a global pandemic.
The WHO announcement comes after a disturbing statement by Dr. Anthony S. Fauci to the US Congress.
According to Dr. Fauci – director of the National Institute of Allergy and Infectious Diseases, the number of COVID-19 virus infections will continue to increase due to inadequate prevention measures. Fauci told lawmakers that “it will get worse” and emphasized that:
"The degree of badness we receive will depend on our ability to do two things: prevent the influx of infected people from the outside, and the ability to control and minimize within our own country. . “
Based on the clear correlation between Bitcoin's price action and traditional markets, traders like CoinTelegraph's partner Michaeleal de de Coue expect Bitcoin to fluctuate in the $ 7,600 to $ 7,300 range in the near future until the near future. when the global market is more stable.
In the event that Bitcoin fails to hold the $ 7,300 support, van de Poppe believes that the No. 1 cryptocurrency will drop to the zone of $ 6,800 and $ 6,400.
The daily chart shows that $ 7,420 is the critical support Bitcoin needs to hold. At the time of writing, the relative strength index (RSI) is in the oversold zone and on a shorter time frame, we can see the diverging converging moving average (MACD) and the RSI are attempt to bounce back to oversold bounce, but obviously traders are not ready to buy when Bitcoin continues to make lower highs and lower lows.
As mentioned in the previous analysis, a large increase in volume can push prices to $ 8,500- $ 8,600 because there is a large gap on the VPVR indicator, but for now, traders don't prioritize high risk production.
For the time being, traders should be cautious when engaging with oversold bounces because the current rebound suggests a slight increase in buying volume that is less volatile in breaking the pattern of lower highs on time frame 4. hours.
The positive turning point of the events will drag Bitcoin prices either further consolidating around $ 7,800 or rising back to the 61.8% Fib retracement level ($ 7,978) and closing above $ 8,100.
The Crypto Fear & Greed index remains at 17 – a level that reflects extreme investor sentiment. In the past, investors used this indicator as a signal to respond to market trends.
Although the current sentiment is likely to make investors want to buy the dip, the instability brought about by the corona virus has created something like a Black Swan event – which is blocking the risk of the investors.
Another concern in the minds of investors is the fact that Bitcoin price is quickly approaching support of the logarithmic trendline. It is still a bit early to speculate the effect of the decline below the log growth trend line, but it is worth noting that such an appearance has not happened since Bitcoin was born.
Right after the stock market closed, cryptocurrency trader Philip Swift shared the chart above and tweet:
“Bitcoin's price only crossed the logarithmic growth path for a short time to get to the lower boundary for a day that really felt a lot of fear / aggression in the market.”
Disclaimer: This article is an analysis by cryptocurrency analyst Horus Hughes – a frequent contributor to CoinTelegraph. Readers should only consult, not consider this as an investment advice, especially from Toiyeubitcoin, we will not be responsible for your investment.
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According to CoinTelegraph
Translated by ToiYeuBitcoin