Bitcoin (BTC) Finally Breaks Below Rising Wedge After Facing Strong Rejection At $9.2k

Bitcoin (BTC) has finally crashed below the rising wedge after facing strong rejection at the 200-day moving average. It has now declined down to the 61.8% fib retracement level seen on the 4H chart which also corresponds to the 50 EMA. The RSI has broken a key uptrend and the price now risks further decline. The recent crash in Bitcoin (BTC) is a testament to the fact that it takes a lot of time to build confidence and for the price to go up but it does not take much time for it to fall. The rising wedge being broken to the downside is significant and is certainly a bearish development but traders may still want to wait for a bearish setup.

The next decline in BTC/USD is going to be quite significant because it might lead to a break below the key trend line support that has supported this entire parabolic run up. If that happens, BTC/USD will risk entering a major downtrend that could last even during the next halving. There is already a strong probability of the upcoming halving being a major bull trap. However, as traders we have no reason to rush to that conclusion until we have a clear break below the major trend line support. If and when that happens, that will be an opportunity to be aggressively bearish on the market. For now, a successive break and close below the 200-day moving average might present some opportunities to sell and short-sell while the price falls down to the trend line support below $8k.

The daily chart for Bitcoin dominance (BTC.D) gives us yet another reason why the cryptocurrency market may be about to enter another major downtrend. What we see here on this chart is truly unprecedented as it will be the first time for Bitcoin dominance to shoot up and enter a larger uptrend since 2017. This will no doubt have serious implications and it will shape the direction of the market for a long time.

Cryptocurrency traders and investors alike are so sure about the price of Bitcoin (BTC) shooting to a new all-time high all while central banks around the world are planning to issue their own digital fiat currencies. The digital dollar, the digital yuan and the digital euro would take no time to be widely adopted and used should these central banks go forth with it. There is a good chance that Bitcoin may have been an experiment that has now paved the way for adoption of central banks issued digital fiat. A move like that would be devastating for the entire cryptocurrency market. A lot of cryptocurrency enthusiasts have a problem with fiat because it is based on faith and trust rather than real value which is true. However, these same enthusiasts have no problem blindly believing and hoping that the price of Bitcoin will rise to a new all-time high or shoot up before the upcoming halving.