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Bitcoin Bulls Might Have Been Bluffing

 
Bitcoin Bulls Might Have Been Bluffing
Breaking News / Bitcoin / Analytics / YouTube

Bitcoin (BTC) has finally closed below the 200 Day EMA. This is a very bearish development and has now changed the near term outlook from neutral to leaning bearish. The reason we are not bearish just yet is because we still need to see a close below the 61.8% fib extension level on the 4H time frame. Another consecutive close below the 200 Day EMA would also be helpful but it is likely that BTC/USD would be in a strong downtrend when that happens so it might be a bit too late. At this point, we have seen most bullish pumps fail and the price is now very close to breaking below $8,543. If it fails to break past the 200 MA on the 4H time frame, we would expect it to decline towards the bottom of the descending channel in the near future to find support in the $7,200s.

Ethereum (ETH) has started the day in red same as Bitcoin (BTC) but the 4H chart for ETH/USD shows that it is losing ground a lot more aggressively. It is possible that we might see a major crash around this weekend if the market continues to see only fake bullish pumps while it steadily declines. It would be important to keep an eye on the EUR/USD forex pair to ascertain which way the market is likely to swing. If EUR/USD breaks to the upside towards the 38.2% fib extension level, we can expect the cryptocurrency market to rally. On the other hand, if the pair starts to decline below the 61.8% fib extension level, we would see it break a major support which could change things quickly and BTC/USD might crash hard. We have seen EUR/USD to be leading indicator for BTC/USD in the past and it could happen again this time. 

Bitcoin dominance (BTC.D) seems to have found some short term relief now that Ethereum dominance (ETH.D) has started to decline. Altcoins are falling harder than Bitcoin (BTC) which explains the rise in Bitcoin dominance. We could see this rise continue in two cases. Either BTC/USD will hold its ground better compared to other cryptocurrencies and the market would be in a downtrend or the rise in dominance will be because of BTC/USD pumping as it did when it shot up 43% in two days outperforming most cryptocurrencies. Both events would be bearish for the overall market even if one of them is bullish for Bitcoin (BTC). Meanwhile, the Fear and Greed Index is indicating fear in the market once again. In my opinion, there is still a lot of bullish greed in the market. The bears seem to be more fearful than the bulls as they are constantly the target of manipulated pumps. The market is now primed for a downtrend and it is only a matter of time before we see it come into effect

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