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Bitcoin Remains On the Defensive With Price Below $8K
May 22, 2019 at 13:15 UTC Updated May 22, 2019 at 18:06 UTC
BTC has traded in a narrowing price range over the last 48 hours, aborting the immediate bullish view put forward by Sunday’s double-digit gains.
A range breakdown, if confirmed, would allow a price drop toward $7,200. That looks likely with multiple signs of bullish exhaustion on the daily chart.
The outlook, however, would again turn bullish if the contracting triangle ends with a bullish breakout. In that case, the price could rise to $8,500.
Bitcoin is teasing a downside break of its recent trading range, having again faced rejection above $8,000 earlier today.
The cryptocurrency market leader jumped more than 12 percent on Friday, reviving the case for a potential break above the June 2018 high of $8,500.
The bullish momentum, however, fizzled out on Monday with prices falling from $8,200 to $7,581. Further, BTC remained on the defensive Tuesday, with prices clocking daily highs and lows within Monday’s trading range.
Essentially, BTC’s narrowing price range has created a contracting triangle over the last 24 hours, neutralizing the immediate bullish view put forward by Sunday’s rally.
The case for notable price pullback, suggested by repeated bull failures at $8,300 would strengthen if the indecision represented by the contracting triangle ends with a downside break.
As of writing, the lower edge of the trading range is seen at $7,805, while bitcoin is trading at $7,824, down 1.6 percent on the day.
While the short-term prospects are looking a little bleak, the long-term outlook remains constructive, with cryptocurrency reporting nearly 50 percent gains on the opening price of $5,267 seen May 1. Further, BTC is trading well above the 200-day MA, currently at $4,485.