bitcoin’s corrective rally is struggling to gain momentum as trading volumes drop to the lowest levels since late last year.
The leading cryptocurrency remained bid over the weekend as expected, courtesy of Thursday’s strong from the two-week lows. However, so far, the break above $6,400 has remained elusive, likely due to low investor interest.
For instance, bitcoin’s total trading volume across all cryptocurrency exchanges fell to $2.92 billion on Saturday, the lowest level since November 7, according to .
The drop in trading volume indicates the bargain hunters are not particularly impressed by BTC’s reversal from the two-week low of $6,080 (hit on Thursday) and also puts a question mark on the cryptocurrency’s ability to hold above the key support of $6,000 (psychological support).
At press time, the leading cryptocurrency is trading largely unchanged on the day at $6,360 on Bitfinex. Meanwhile, 24-hour trading volume has improved slightly to $3.5 billion, according to .
Daily chart
The above shows the Bollinger Bands (standard deviation of +2, -2 on the 20-day moving average) are flatlined, meaning BTC lacks a clear bias.
A close (as per UTC) above the 20-day moving average (MA), currently located at $6,400, would open the doors for completion of the , i.e. BTC could rally to $6,838 (inverse head-and-shoulders neckline resistance). However, BTC will likely have a tough time holding on to gains above 20-day MA if trading volume remains weak.
Interestingly, the upper Bollinger Band is also located at $6,838, so the level will likely act as a stiff resistance in the near-term.
4-hour chart
The relative strength index (RSI) is biased toward the bulls, so there is scope for a move above 20-day MA. On the other hand, a break below $6,240 (rising trendline support) would pour cold water over the optimism generated by BTC’s strong defense of $6,000 (February low) last week.
View
- Low trading volumes are complicating bitcoin price recovery.
- A close (as per UTC) above the 20-day MA of $6,400 would allow a rally to $6,838 (inverse head-and-shoulders neckline + upper Bollinger Band).
- On the downside, a break below $6,000 (February low) would shift risk in favor of a drop to $5,755 (June 24 low).
Disclosure: The author holds no cryptocurrency assets at the time of writing.
via Shutterstock
The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a . CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.
Published at Mon, 16 Jul 2018 09:00:26 +0000
Markets[wpr5_ebay kw=”bitcoin” num=”1″ ebcat=”” cid=”5338043562″ lang=”en-US” country=”0″ sort=”bestmatch”]
