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George Spencer

October 12, 2021

Bitcoin Goes Below $56k

Bitcoin faced rejection at $57,700 as it failed in its bid for $58,000. The struggle for $58k was the expected needed boost for the a breakout above $60k. Unfortunately this dream was cut short as Bitcoin dipped $56,000.

Bitcoin has held on to this support for a while and the bulls shielded it from every attack as they kept the largest coin by market in an uptrend. Bitcoin apparently fell into bearish dominance, hence the retracement we are seeing today. With bitcoin two clicks away from $58k, what will happen in the next few days?

Following the sudden move to $55k, crypto derivatives have been a little dull as it keeps recording low participations. The same energy is seen in the spot market as it seems the buyers are content with bitcoin price.

The docile interaction between the buyers and sellers changed on the first day of the new week as we noticed the coin pick momentum. The trajectory was aimed at $58,000 but failed as buying pressure wasn’t enough to topple the mark.

Following the failed attempt, two indicators flashed warnings. The Moving Average Convergence Divergence is one such indicator. After a bullish interception at the start of the month, the fast line picked up momentum and has been on the rise.

We may see a bearish interception within the next seven days. A crossing may mean a break from the uptrend as bitcoin and altcoins’ prices will plummet. Another indicator that has been flashing warning is the Stochastic Oscillator. This oscillator has been above 80 since October 1. Any asset trading above the set mark is due for correction and will face a retracement soon.

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Using the pitchfork, we created a channel highlighting key resistance and support. The $58k resistance is still a tough one as bitcoin has been unable to flip the price mark. The $53,000 is a critical support as none is present after this mark until $50,000.