Bitcoin price started the day at $10,492 to immediately move upwards and touch a high of $10,573 only to be rejected. The profit booking turned severe in the next few hours as the pair broke below $10,300 to touch day’s low of $10,062 and threatened to break the psychological $10K barrier.
Bulls came into few hours later to buy small dips on the hourly chart. Subsequently, the BTC/USD price once again moved past the $10,500 level. But this time, the rejection was even more violent, and the crypto king immediately rolled towards $10,138 low. Currently, the price has recovered slightly to trade around $10,225 level.
There’s a bearish overtone to the Bitcoin price prediction as BTC/USD struggles to hold vital support levels. In case the crypto king slips below the $10,000 level, the next big support at $9,700 will serve as an even stronger cushion.
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Bears have dominated Bitcoin price in the last 6 hours
Bitcoin price met severe resistance at $11,200 and quickly tumbled down. During the fall, the BTC/USD pair first found support at $10,800 only to find the ground slippery. Attempts to bounce back were again met with rejections, and the price moved below the crucial $10,300 mark to touch new daily lows.
The bulls clearly look exhausted and are finding it difficult to penetrate through the resistance ceiling above at $11,000. Bearish positions are piling up as Bitcoin price moves to touch even lower support at $9,700.
BTC/USD 2-hour chart is filled with red candlesticks
Bitcoin price has now entered bearish territory on the hourly charts since it has broken below key support at $10,500. The pair has not been able to move past the SMA20 curve currently situated at $10,480. However, the rising volatility can cause an imminent breakout provided the volume rises around the 20-day Bollinger Band.
As trader Alan Masters points in below chart that if the price closes the day under 100-day exponential moving average, new lows will be in sight. The pair can even slide towards $9,200.
The MACD is showing a bearish signal as the market momentum shifts downwards. The RSI is slowly inching towards the oversold territory. Even though the hourly charts are sounding a death knell for the bulls. The psychological support at $10,000 can serve as a bounce-back price point.
So, how much decline is in store for Bitcoin price?
The daily Fibonacci patterns observed at 38.2 percent and 23.6 percent, along with the Bollinger Band curve, are painting a neutral picture with a downward bias. The price has been summarily rejected from crucial resistance at $12,000. Moreover, the Bitcoin price is now trading below the $10,500 support mark.
The pair will touch oversold territory on the hourly charts at $9,700, and it will likely witness as a strong to moderate buying action. Interestingly, it is also the weekly Fibonacci 161.8 percent retracement mark.
‘Buy the Dip’ signal from Spent Output Profit Ratio (SOPR) indicator
Glassnode’s Spent Output Profit Ratio is a leading on-chain data-based indicator. On-chain metrics can deliver insights on better predicting the market. Glassnode says that its SOPR indicator is hinting towards a buy signal as per the current Bitcoin ecosystem.
Spent output profit ratio (SOPR) is dipping below one right now.
In bull markets this is a buy the dip opportunity.
I believe there is sufficient technical and fundamental evidence to suggest we are in the early stages of a bull market right now. pic.twitter.com/ji1P54iR1F
— Philip Swift (@PositiveCrypto) September 22, 2020
As per Glassnode, the SOPR index reflects the average stakeholder’s profit or loss scenario. It is calculated as the ratio of realized value output spent to the creation value. It shows the progress of stakeholder’s profit sales on an average. In case the SOPR value is more than one, it shows that price at which coins are being sold is more than what was paid for buying and vice versa.
Presently, the SOPR index is signalling a ‘buy the dip’ light to the traders. Philip Swift of Decentralized says that SOPR is shifting under one level, and it is the perfect time to buy the BTC/USD pair. Considering the current decline, traders will have to study other factors before putting their money on the bull case.
Bitcoin price prediction: Profit booking imminent before the leg next down
Bitcoin price has sharply declined from the $10,415 support line and now entered the bearish territory. Today marks the third straight day of bearish activity, and SMA 20 curve offers stiff resistance to any upward movement. Squeezes in Bollinger Bands on hourly charts show that volatility is extremely low. However, squeezes are usually indicative of a massive upcoming price movement. Technically, the longer the period of a squeeze, the more prominent will be the price breakout.
#bitcoin options total open interest briefly reclaiming all-time-high before blockbuster expiry Friday of 88k options pic.twitter.com/tWPsSgjX0a
— skew (@skewdotcom) September 23, 2020
As of now, the price will move horizontally on the daily chart with a bearish trend on the hourly timeframe. So, as of now, it looks like the price will trend horizontally as BTC enters a period of consolidation.
Disclaimer: The information provided is not a trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.
