Bitcoin (BTC) – Technical signals deteriorated dramatically in the last few weeks

Bitcoin (BTC) – Technical signals deteriorated dramatically in the last few weeks

Posted on Sunday, September 18 2022 at 8:45 pm GMT+0000

Bitcoin (BTC) could barely rotate since the rejection near the upper-Bollinger band and the early August low of 22,400 on Tuesday and has been since tiptoeing just beneath the 20-day simple moving average, refusing to show any recovery appetite.

The mid-August decline critically degraded the medium-term technical picture. And despite the recent horizontal path followed by the Bollinger bands, the risk is currently leaning to the downside as suggested by the oscillators. The MACD navigated lower from the vicinity of the zero mark and appears ready to cross below its trigger line, while both the RSI and stochastics are still holding heavy well beneath the equilibrium lines and some distance beyond the oversold territory, signaling that there is still some room for further deterioration in the market.

Following any uptick in selling interest, the sellers could once again challenge the 18,500 – 17,600 zone linking the September 7th low and June 18th bottom which managed to mute the negative forces multiple to times this summer. The lower-Bollinger band is in the neighborhood adding extra importance to the region. Thus, a decisive close lower will further worsen the current outlook and motivate an immediate decline towards the 16,000 – 15,000 area. Further lower, eyes will turn towards the mid-August 2020 highs around 12,500.

Alternatively, a sustainable move beyond the 20-day simple moving average may initially test the upper-Bollinger band and the neighboring 22,800 last week’s high. A rally above the latter would probably stage fresh buying interest, with the price moving next to a tough resistance band, the 25,200 – 25,400 joining the mid-August high and the May 12th bottom respectively, which buyers should overrun to claim control of the reins. In such a scenario, the spotlight will turn towards the 28,000 region.

To summarize, technical signals deteriorated remarkably in the last few weeks, but sellers may wait for an extension below 17,600 to raise their exposure in the market. Yet only a significant move beyond 22,400 could inject some optimism back.