Bitcoin loses ground from $12,000 to retest support at $11,100.
A recovery pulled above $11,400 but BTC is not out of danger yet, especially if the price slides below the Ichimoku cloud.
Bitcoin price has explored lows towards $11,000 once again. The largest cryptocurrency embarked on a support smashing exercise after failing to hold above $12,000 following a significant breakout on Monday. Bearish control is widespread across the market with other major digital assets like Ethereum and Ripple posting similar losses.
At the time of writing, Bitcoin has recovered above $11,400. If bulls increase their entries, they might create more volume, in turn, pushing Bitcoin above the next key levels at $11,600 and $11,800. It is now clear that $12,000 is the most critical level in Bitcoin’s recovery journey. The recent break made a daily close above this level but intense selling pressure saw all the effort made by the buyers go into the drain with BTC spiraling to $11,000.
According to the Ichimoku Cloud, Bitcoin is still in an area with intense support. This explains the immediate reversal above $11,400. On the other hand, losses below the cloud would signal more retracement to levels closer to $10,000.
The Relative Strength Index (RSI) suggests that Bitcoin is ready for consolidation. Price action towards $12,000 will remain limited in the coming sessions. The sideways trading will stay put as long as the RSI continues to level at 50.
The formation of a rising wedge pattern (discussed on Wednesday) spells doom for Bitcoin in the coming weeks, especially if support is not established above $12,000. A breakdown under the pattern’s support is likely to encourage more selling entries, likely to pull Bitcoin massively below $11,000.
Luke has had a long interest in financial technology, especially cryptocurrency and blockchain. With a Bachelors degree in Journalism and Media, Luke is dedicating his writing skills for the digital currency sphere.He can be contacted at email@example.com