Bitcoin (BTC) – Exposed to a new bearish round

Bitcoin (BTC) – Exposed to a new bearish round

Posted on Sunday, June 26 2022 at 9:44 pm GMT+0000

Bitcoin (BTC) shifted to the sidelines last week following the brutal sell-off earlier this month, which worsened the broad outlook and squeezed the price to a fresh multi-year low of 17,600.

The price created a bullish engulfing pattern near the aforementioned low on June 19th, signaling that the buyers could push for some more recovery in the short-term, but although the crypto-king barely nudged past the middle-line of the regression channel stretched from the March peak, additional green candlesticks will be needed to confirm that.

In other encouraging signs, momentum oscillators are increasing the stakes for some more bullish developments in the coming sessions. The RSI and the TSI shifted north in the bearish waters, and the latter is ready to cross above its signal line. Additionally, the stochastic is ramping up to meet the 50-neutral threshold.

All eyes are currently turned to the 20-day simple moving average seen around 23,500 which may curb the current recovery attempt. Should it give way, it would be interesting to see if Bitcoin can attract enough buyers to breach the zone formed between the upper-line of the channel and the May 12th low of 25,400. If that turns out to be the case, a jump over the 50-day simple moving average and the neighboring May 26th low at 28,000 will likely see an acceleration towards the May 31st peak at 32,400.

Yet, given the persisting negative bearing of the moving averages and the fact that momentum oscillators didn’t exit the bearish territory yet, traders may cautiously monitor any upside corrections. If the 20-day simple moving averages managed to press the price lower, the bears will immediately challenge the last bottom at 17,600. By cracking that support base, they will push towards the 15,000 and 10,000 round psychological areas.

Summarizing, although the latest downfall is showing some signs of exhaustion, the bulls will need first to overcome the 20-day simple moving average and more importantly to knock down the 25,400 ceiling to get the upper hand. Otherwise, a continuation of the broad downtrend towards fresh lows remains the most likely scenario.