In the conclusion of the previous Bitcoin price technical analysis And Here Comes the Rebound, I stated that the current relief rally in Bitcoin will fizzle out very soon and that the market participants should be prepared to create short positions. We have seen this happen in yesterday's trading session where attempts made by the bulls to scale higher were undone by profit booking and renewed selling pressure.
Bitcoin is currently trading flat at $224, after racing to an intraday high of $231.09 and is now expected to trend lower in the coming sessions.
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Bitcoin will witness a greater selling pressure in the coming sessions, and that is also indicated by the latest technical considerations.
Bitcoin Chart Structure – The bulls have failed at violating the lower top, lower bottom structure, which confirms that the bears are waiting on the sidelines to come into action on attractive levels.
Moving Averages – The 30-day SMA of $257.5093 is fast inching towards the 200-day SMA of $250.5519. If the 30-day SMA crosses the 200-day SMA on the downside, it would be an indication of heavy bearishness in the cryptocurrency.
Moving Average Convergence Divergence – The MACD can be seen making attempts to cross the Signal Line on the upside, thereby putting the Histogram closer to the positive region. The last seen values of MACD, Signal Line and Histogram were -13.9883, -12.6697 and -1.3186.
Momentum –The Momentum reading is still highly negative at -32.4700.
Money Flow Index – The MFI has advanced to 45.7665 to reflect the recent price jump.
Relative Strength Index –The underlying strength in Bitcoin remains feeble at best, confirmed by the RSI value of 35.0566.
Conclusion
Market participants are advised to remain bearish on the cryptocurrency and do not indulge in impulsive buying. Short on rallies by placing strict stop-losses and maintaining a risk-reward ratio of at least1:2.5.