Bitcoin Breaks Lower as it is under Pressure

Updated On Feb 1, 2018 by Kate Leaman

Bitcoin (BTC/USD) has broken lower, but price movement remains volatile. The Daily chart, seen below, shows that the cryptocurrency remains under pressure as the bears remain in control. BTC is trading at the support located at $9,900.

A break below this level challenges $9,500. The resistance barriers remain at $12,500 to $13,000.

Today, the 100 day moving average is above the longer term 200 day moving average. This could entice the bulls to come into the picture, at least somewhat. This could mean some gains for Bitcoin before moving lower once again. The gap between these two daily moving averages is not much so the downside risk could be reducing.

The stochastics are still showing the cryptocurrency is not as sold off. This could mean Bitcoin could see some support. The RSI is also improve. This could mean a test of the former support level, now resistance at $11,100.

BTC/USD Trading Daily Chart: February 1st 2018

Traders are blaming profit taking for the recent losses. The Federal Reserve kept rates as is yesterday which was no surprise and now traders are waiting on the non-farm payroll report, due on Friday. The Federal Reserve was a bit more hawkish with inflation expectations, which means if the NFP comes in strong, the U.S. dollar could find more support, sapping strength from Bitcoin.

With that said, traders are still concerned with inflation which means the Fed might be more cautious. In other words they are not convinced and remain wary of the dollar. Also, there has been jawboning out of Washington D.C. that has weakened the USD. Especially last week.

Bitcoin has been somber and on the defensive as well as traders are waiting on a catalyst to move the market. There has also been a spat of legislation regulating the cryptocurrency in several countries which caused some to sell Bitcoin. These new regulations came about due to the recent hack of Coincheck.

Kate Leaman Author

Kate is our resident cryptocurrency expert, she will be guiding you through the rise of new digital coins as well as providing insights of what's to come and what to avoid going forward..

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