Bitcoin’s price didn’t hold above 60,000 on Wednesday.😔

The decline followed a transient surge after Federal Reserve Chair Jerome Powell’s recent speech at Jackson Hodl err Hole.

The past three months have been tough for orange pill poppers world wide, with bitcoin declining over 12% and its continued failure thus far to retest its recent all-time high of nearly 74,000 reached earlier this yr.

Analysts suggest that profit-taking by crypto traders and low trading volume during this time of yr could also be contributing to the drop.

Despite this, bitcoin continues to see inflows into U.S. spot bitcoin ETFs, indicating sustained investor interest. Nonetheless, concerns that the U.S. government could also be selling seized bitcoins might be putting additional pressure on prices.

The recent correction might also signal a return to more stable levels after the initial boost from anticipated Federal Reserve rate of interest cuts.

What about bitcoin’s technical outlook?

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Welcome to TA of the Day (TAOTD)! 👋

Let’s concentrate on the present technical setup of the bitcoin (BTC/USD) based on the each day chart:

📈 Technical Evaluation of BTC/USD Every day Chart

Let’s analyze BTC/USD using key technical evaluation concepts covered in our forex course.

Exponential Moving Averages (EMAs):

• 10-period EMA: Positioned around 61,046.16. The value is currently below this level, indicating short-term bearish momentum. The downward slope suggests recent selling pressure within the short term.
• 20-period EMA: Positioned around 60,940.00. The value is below this level, reinforcing the short-term bearish trend. The downward slope of the 20-period EMA indicates increasing bearish momentum.
• 50-period EMA: Positioned around 61,575.91. The value can be below this level, confirming medium-term bearish momentum. The downward slope suggests that the medium-term trend is favoring the bears.
• 200-period EMA: Positioned around 59,613.08. The value is currently near this level, indicating that the long-term trend is being tested. The slope is comparatively flat, suggesting a possible area of support.

Keltner Channels (KC):

• Upper Band: Positioned around 66,434.81. The value is well below this level, indicating that the recent price motion has been bearish and closer to the center and lower bands.
• Middle Line (20-period EMA): Positioned around 60,940.00. The value is currently below the center line of the Keltner Channel, indicating a bearish bias.
• Lower Band: Positioned around 55,445.19. The value is closer to the center of the channel, indicating that there may be potential room for further downside towards the lower band if bearish momentum continues.

Moving Average Convergence/Divergence (MACD):

• MACD line (2.47) is above the signal line (-161.27) Each lines are above the zero line.
• Histogram is positive but decreasing, suggesting weakening bullish momentum.

🕵️ Key Observations

Price Motion:

Let’s analyze the value motion of bitcoin (BTCUSD) from its last swing high at the tip of July:

1. End of July Swing High: The value reached an area high of around 70,000 at the tip of July.
2. Initial Pullback: Following this peak, there was a pointy pullback. The value dropped to around 65,000, creating a major red candle.
3. Consolidation: After the initial drop, the value consolidated between roughly 65,000 and 68,000 for just a few days, forming a series of smaller-bodied candles.
4. Renewed Selling Pressure: In early August, selling pressure intensified. The value broke below the consolidation range, dropping to around 62,000.
5. Attempted Bounce: There was a transient bounce attempt back to about 65,000, but this was quickly rejected.
6. Sharp Decline: Mid-August saw a dramatic drop. The value plummeted from around 65,000 to a low of about 55,000 in a single day, forming a protracted red candle with a major lower wick.
7. Volatile Recovery: Following this sharp decline, there was a powerful bounce. The value recovered quickly to around 60,000-61,000 over the subsequent few days.
8. Resistance at Previous Support: The 60,000-62,000 area, which previously acted as support, has now became resistance. The value struggled to interrupt above this level convincingly.
9. Range-Sure Trading:  Bitcoin entered a range-bound phase, oscillating between roughly 58,000 and 62,000.
10. Failed Breakout Attempt: There was a transient try to break above 62,000 but this was quickly rejected.
11. Recent Downward Pressure: Essentially the most recent price motion shows renewed downward pressure, with the value dropping back towards the lower end of the recent range, around 59,000.
12. Lower Highs: Each attempted recovery has resulted in a lower high in comparison with the previous peak, indicating weakening bullish momentum.
13. Higher Lows: Despite the general downtrend from the July high, the value has been making barely higher lows for the reason that mid-August drop, potentially forming a descending triangle pattern.

In summary, the value motion for the reason that end of July swing high has been predominantly bearish, characterised by a series of lower highs and increased volatility.

The market has transitioned from a transparent uptrend to a more uncertain, range-bound environment with a slight downward bias. The value is currently consolidating in a tightening range, suggesting a possible for a major move once this range is broken in either direction.

Key Levels:

• 60,000: Essential psychological level and near the 20 EMA
• 65,000: Recent resistance level
• 55,000: Strong support level (lower Keltner Channel)

Support and Resistance Levels:

• Major resistance: 65,000-$66,000 (recent highs and upper Keltner Channel)
• Immediate resistance: 61,000-62,000 (20 and 50 EMAs)
• Immediate support: Around 58,000-59,000 (recent lows and 200 EMA)
• Strong support: 55,000-56,000 range (lower Keltner Channel and former lows)

🤔 Potential Trade Scenarios

Is BTC/USD a buy or sell?

Long Bias:

• Consideration Point: Consider entering a protracted position if the value finds support on the 200-period EMA and begins to point out signs of reversal, comparable to a bullish divergence within the MACD or a powerful bullish candlestick pattern.
• Invalidation Point: Consider setting a stop-loss below the 200-period EMA at around 59,000 to administer risk.
• Potential Goal: Search for a move back towards the center Keltner Channel line at 60,940 or higher if a reversal occurs.

Rationale: The 200-period EMA could act as a powerful support level, and any signs of bullish reversal could present a buying opportunity, particularly if the broader market sentiment improves.

Short Bias:

• Consideration Point: Consider entering a brief position if the value breaks below the 200-period EMA at 59,613 or if there may be a bearish continuation pattern on the lower timeframes. One other potential entry point is a rejection on the 10-period EMA.
• Invalidation Point: Consider setting a stop-loss above the 20-period EMA at around 61,000 to administer risk.
• Potential Goal: Search for a move towards the lower Keltner Channel band at 55,445 if the downtrend continues.

Rationale: The strong bearish momentum, confirmed by the MACD and the value’s position below the center Keltner Channel line and all key EMAs, suggests further downside potential. The 200-period EMA is a critical level to look at, as a break below it may lead to a major sell-off towards the lower Keltner Channel band.

📝 TAOTD Summary

Bitcoin is showing a mixed trend with recent volatility and a bearish short-term momentum.

• Current Position: The value is in a downtrend, testing the 200-period EMA for support. The bearish momentum is confirmed by the MACD and the value’s position below all key EMAs and the center Keltner Channel line.
• Trend: The general trend is bearish, with the value below the 10-period, 20-period, and 50-period EMAs. The 200-period EMA is a critical level that would determine the subsequent significant move.
• Support/Resistance Support at 59,613 (200-period EMA), with resistance at 61,046 (10-period EMA) and 60,940 (middle Keltner Channel line).
• Momentum: The MACD indicates strong bearish momentum, with potential for further downside if the value breaks below the 200-period EMA.

Bitcoin is in a consolidation phase and its market structure suggests that it’s at a critical juncture.

The long-term uptrend is being challenged by short-term bearish pressure.

Be cautious, as the present structure suggests a possible for a major move in either direction once the consolidation phase resolves.

The recent price motion of bitcoin shows a struggle between buyers and sellers, with a short-term bearish bias evident in essentially the most recent movements.

The tight grouping of EMAs and position throughout the Keltner Channel suggests the market appears to be in a state of indecision, with significant resistance across the 60,000-61,000 level and support around 57,800-58,000.

The failure to interrupt higher and the recent drop below the 20-day EMA suggest that bears may need a slight upper hand within the very short term, but the general picture stays mixed.

👀 It is best to watch the 200-period EMA closely.

The interaction of price with its 200-day EMA and the resolution of the present range will likely determine the subsequent major trend direction.

A break below this level could signal further downside towards the lower Keltner Channel band, while a reversal at this level could provide a buying opportunity.

This content is strictly for informational purposes only and doesn’t constitute as investment advice. Trading any financial market involves risk. Please read our Risk Disclosure to be certain you understand the risks involved.