Green lines- trading range
Red line -resistance
Bitcoin is in a sideways trading phase very similar to the one it was back in May. Price is moving sideways inside a trading range shown by the green lines. Price action is very similar to recent past and the most probable outcome would be for price to break to the downside as it did back in May. One reason why we believe a break to the downside is more probable is the red trend line. Price continues making lower lows and lower highs staying below the red trend line. Medium-term trend remains bearish.
Red lines- Fibonacci extension targets
The RSI in the Daily chart has still not provided us with a bullish divergence. This implies that more downside is justified. The downward move in Bitcoin that started at the end of March from around the $48,000 price level, has still not reached the 100% extension target of the first leg down. If recent low at $17,500 area is broken, I would expect Bitcoin price to move very close to the 100% Fibonacci target around $12,000. So far there is no sign of a reversal. Bears remain in control of the trend.
