Here’s What The Next Bitcoin (BTC) Downtrend Might Look Like 

Here’s What The Next Bitcoin (BTC) Downtrend Might Look Like 

Bitcoin (BTC) has run into resistance at the $9.5k level. This is a strong resistance zone that the price was very unlikely to breach. We have seen BTC/USD decline towards $9k now but it could still try to retest the $9.5k mark or even rally slightly higher than that again to mislead retail traders. However, the point is we have now seen the writing on the wall and it is quite clear to see what might happen next. If we compare the current cycle with the previous one, we can see that the price is not at the June-July part of the 2014-15 cycle. This means that we are up against a devastating downtrend ahead. 

So, if we recognize that BTC/USD is indeed going to see significant further downside ahead, we would also need to realize that this kind of a slow bleed is not going to happen without there being a glimmer of hope that keeps traders excited even when the price systemically declines. That hope at the moment is the upcoming Bitcoin halving. If the price declines below the halving, most retail traders would still expect it to rise at some point close to or after the next halving. This kind of hoping and wishing gives the whales the perfect opportunity to prey on retail traders that trade based on sentiment rather than technicals. The next decline below the 200-day moving average should serve as a stark warning to most traders in this market to stop being bullish, but very few of them will because the greed to profit off a potential rally before halving will be too much. 

On a smaller timeframe, we can observe how BTC/USD has now begun its downtrend. The price has entered a descending broadening wedge as we can see on the 15 min chart and that is how it declined down to $9k. If it continues to trade within this wedge, we could expect a below $9k in the near future. However, if the price breaks to the upside out of this wedge, we would be looking at a potential retest of the $9.5k level or slightly higher. 

It is important to realize that the stock market is on the verge of beginning a major correction. Political and economic developments this month are going to shape the outlook of major financial markets for the rest of the year. Bitcoin (BTC) and the rest of the cryptocurrency market will be strongly influenced by that as always. This is why it is equally important to keep an eye on the S&P 500 (SPX), the EUR/USD forex pair and commodities like WTI Crude Oil (USOIL) and Gold (XAU/USD) to ascertain what could happen next in this market. 


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