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Bitcoin (BTC/USD) Dips Below $9000, Testing Support/Resistance Pivot

Bitcoin (BTC/USD) fell sharply during the 5/10-5/11 sessions. We recently discussed how BTC/USD looked "toppy" after missing the $10,000 mark. The $9000 area was a key support. As we will see on the 1H chart, there was indeed a bounce, but the subsequent resistance at $9400 became a harbinger for further decline.

BTC/USD 1H Chart

  • In the previous assessment, we noted that if price can hold above $9400, it might go back up to $10,000.
  • Instead, price found resistance at $9400, which was where the 200-hour simple moving average resided.
  • Meanwhile, the 1H RSI held under 60, which is a sign that prevailing bearish momentum is being maintained.
  • Here is what we said last time if price instead falls below $9000:
Bearish Outlook:
  • But if price falls below $9000 and the RSI below 40, the bullish trend could be over.
  • Below $9000, we can anticipate a dip to $8400. The bearish outlook improves if $9000 now becomes resistance. 
  • As we can see on the 1H chart, price did not stop at $9000 on the second test and fell straight through.
  • We can also see that $9000 acted as resistance before price continued to fall.
  • Finally, the anticipated $8400 target was reached during the 5/11 session, and Bitcoin is stalling here so far as the Friday session winds down.
  • This $8400-$8600 area is a support/resistance pivot area - so no surprise price is stalling here. Maybe price will rebound at least in the very short-term.
  • If there is a rally, we should monitor the $8800-$9000 area as resistance.
  • Breaking above $9000 will be needed to relief Bitcoin from its now bearish outlook.

 

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