Bitcoin's drop to three-week lows today has likely kick-started a bearish move towards the major support at $6,000, technical charts indicate.
The leading cryptocurrency fell to $6,252 at 7:15 UTC on Bitfinex - the lowest level since Sept. 19 - and was last seen trading at $6,300, representing a 5-percent drop on a 24-hour basis.
Further, the big drop in the equity markets this morning may not bode well for BTC, as the cryptocurrency is still being treated as a risk asset.
As a result, bitcoin price volatility, as represented by Bollinger bandwidth and the gap between weekly high and low, fell to 21-month lows and 15-month lows, respectively, last week.
A prolonged period of low volatility usually makes way for a big move in either direction.
In BTC's case, that move looks to have already started to the downside, with a breach of the lower band, and may move further towards $6,000.
The bearish view put forward by the negative crossover between the 5-month and 10-month EMAs has gained more credence, courtesy of BTC's failed breakout and a drop to three-week lows.
BTC's drop to lows below $6,300 comes a day after the Dow Jones Industrial Average shed 800 points.
Looking ahead, the equities could drop further, courtesy of the rising bond yields, and push BTC lower.
A violation there would allow a deeper drop to $5,870 - support of the trendline drawn from the June low of $5,755 and the August low of $5,859.
4 Reasons Why Bitcoin's Price Could Now Drop to $6K
Published on Oct 11, 2018
by Coindesk | Published on Coinage
Mentioned in this article
Coinbase Adds More Ethereum Cryptos: Golem, Maker, Zilliqa, Dai
Today, Coinbase has added four new Ethereum ERC20 tokens to Coinbase Pro: Golem, Maker, Zilliqa, and Dai.
Tim Draper Invests $1.25 Million in Bitcoin Payments Processor OpenNode
U.S.-based venture capitalist Tim Draper has invested $1.25 million in OpenNode, a bitcoin-only payments processing startup.
Overstock's Medici Acquires Digital Tokens Representing Startup Equity Shares
Overstock.com's investment wing, Medici Ventures, has successfully purchased digital tokens representing 3.6 million shares from Chainstone Labs, a digital securities company.
Blythe Masters, CEO of Blockchain Startup Digital Asset, Is Stepping Down
Blythe Masters, the CEO of distributed ledger technology provider Digital Asset Holdings, has stepped down after three years running the firm.