Is Bitcoin (BTC) Ready To Crash Below $7k?

Bitcoin (BTC) has finally begun its downtrend and is currently trading below the key support level of $7,400. The price remained range bound for a long time but is now expected to take a definitive direction. Traders might want to wait and see how the price trades around the 200 moving average. If it declines below that and subsequently the $7,193 level, that might be an opportunity to go short. If BTC/USD declines below $7k a lot of cryptocurrencies including large cap coins like Ethereum (ETH) will be hit the hardest especially because they have already lost much ground against Bitcoin (BTC) and haven’t had the time tor recoup their losses just yet.

The weekly chart for BTC/USD shows that the price is now expected to decline down to the $5,500 level again which would correspond to the 200 Week EMA. It is interesting to note that the last time the price tested the 200 EMA was less than 1000 days ago. So, if it happens so soon in the near future it would be breaking a previously established pattern of the market testing the 200 EMA on the weekly time frame after a much longer time. The last time it happened, the price had just completed a cycle. The fact that it is happening again in the middle of an incomplete cycle tells us that BTC/USD might be headed a lot lower. That is totally in line with our expectations as Bitcoin (BTC) needs to decline below $5,500 to create a maximum pain scenario. A decline to $6,000 or even $5,500 is too obvious at the moment and a lot of bulls would be waiting to buy around those levels.

Ethereum (ETH) has faced rejection at the $132.35 level once again and is now likely to decline lower. The daily chart for ETH/USD shows that this is a strong resistance level that is not going to be easy to breach. Meanwhile, investors expect Bitcoin dominance (BTC.D) to decline down to the 200 moving average so altcoins could rally near-term but it is too risky to bet on that outcome even though the Fear and Greed Index points to “extreme fear” in the market. Our previous analyses on the Crypto Daily Charting Platform have now played out exactly as we anticipated. The analyses on XRP/USD on the platform indicates more trouble for Ripple (XRP) in the days ahead. Meanwhile, the EUR/USD forex pair has started to decline and the S&P 500 (SPX) is about to make a double top on the RSI. All of these developments indicate that the cryptocurrency market might soon begin another downtrend and it is not worth the risk/reward to be chasing any potential bullish moves at this point.