Bitcoin (BTC) has just closed last week below the 50% fib retracement level after facing a strong rejection. We can see that most cryptocurrencies have already topped out and begun their downtrend. Bitcoin (BTC) performs better than most coins during a downtrend which is why it might hold its ground better but is going to decline nonetheless just like the rest of the market. Price analysis suggests that we could see a leg down to $8,500 which would place BTC/USD around its 21 week exponential moving average. A short term recovery from there would be likely as investors buy the dip.
We could then see the price rally towards $10k to test the trend line support turned resistance. It might end up rallying even higher possibly towards $12,000 but it will begin its downtrend from there. The big picture remains intact and the monthly chart shows that BTC/USD has yet to break past the trend line support turned resistance. As long as this trend line is not breached, we cannot expect the next bull run to begin. In fact, it would be reasonable to expect the price to begin another downtrend from here considering it is heavily overbought on larger time frames. Taking a look at the RSI, we can spot bearish divergence. We can also see that it rallied in a way that we have not seen in a long time.
Every time the RSI has shot up like that, we have seen it crash soon afterwards and there is no reason to think this time will be different. The Economic Calendar shows that there are a few events next week that could influence the strength of the US Dollar and therefore the price of Bitcoin (BTC). Most significant of these is the Nonfarm Payrolls (JUN). If the actual figure is lower than the forecast, we might see a weakness in the dollar and Bitcoin (BTC) could benefit. However, if the actual figure is higher than the forecast then we might see strength in the dollar and Bitcoin (BTC) will have to fall.