Pullback Ahead? Bitcoin Price Shows Weakness Above $10K

Having found weak hands above the $10,200 mark in Asian hours, bitcoin has slipped back into four figures.

The cryptocurrency rose above $10,000 at 17:29 UTC yesterday, but ran into offers at $10,218 and dropped to $9,865.29 at 21:59 UTC. Another attempt to score gains above the $10,000 mark ran out of steam at a high of $10,293.44 at 02:14 UTC. As of writing, CoinDesk’s Bitcoin Price Index (BPI) is seen at $9,960.

Despite the pullback from a 16-day high of $10,293.44, the cryptocurrency is still up 1.56 percent on a 24-hour basis, according to data source CoinMarketCap.

On Bifinex (the biggest exchange by volume), trading volumes surged as BTC rose above $10,000 yesterday. However, as seen in the chart below, the volumes have dropped in the subsequent hours, explaining the failure to post solid gains above $10,000.

1-hour chart (volumes)

Also, as discussed earlier this week, the weekly chart remains bearish, thus a struggle to hold above $10,000 should not come as a surprise. Further, the shorter-duration technical charts indicate scope for a further drop towards $9,000.

1-hour chart

The above chart (prices as per Coinbase) shows:

• Bearish price-relative strength index (RSI) divergence, marked by higher highs on prices and lower highs, and signals the short-term bullish-to-bearish trend change.
• Rounding top on the RSI, indicating the rally from the Feb. 11 low of $7,857.78 may have found a temporary top above $10,000.
• The 1-hour 50-MA is curled up in favor of the bulls.
• Strong support at $9,090 (confluence of the ascending trendline and the Feb. 10 high).

View

• BTC looks could revisit $9,000 in the next few hours as suggested by the topping pattern on 1-hour chart.
• Bullish scenario: A rebound from $9,000 would keep bitcoin in the hunt for $11,000 (inverse head-and-shoulders target), although only a high volume break above $11,300 would revive the bullish outlook.
• Bearish scenario: A daily close (as per UTC) below $9,000 would add credence to the bearish weekly chart and the potential for a stronger retreat to $7,851 (Feb. 11 low).

Disclosure: CoinDesk is a subsidiary of Digital Currency Group, which has an ownership stake in Coinbase.

Playing cards image via Shutterstock

The leader in blockchain news, CoinDesk is an independent media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. Have breaking news or a story tip to send to our journalists? Contact us at [email protected].

Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Please conduct your own thorough research before investing in any cryptocurrency.