Bitcoin Eyes First Test of $7.2K Price Support Since April

View A high-volume range breakdown seen on the daily chart suggests scope for test of a long-term moving average at $7,200.

A corrective bounce above resistance at $7,534 could be seen before a deeper drop, as the intraday charts are reporting oversold conditions.

Long-term bitcoin price support at $7,200 may be put to test for the first time in six months, likely after a minor price bounce.

That's the biggest single-day drop since Sept. 24, when prices had declined by 11.83%. The range breakdown indicates the sell-off from highs above $10,000 seen on Sept. 23 has resumed and prices could test support at $7,200 - the 100-period moving average on the three-day chart.

The drop to the key support may be preceded by a minor corrective bounce, as the intraday chart indicators are reporting oversold conditions.

As a result, the cryptocurrency appears on track to test the three-day chart 100-candle MA at $7,200.

The sell-off may stall around the aforementioned crucial support levels, as the 50- and 200-day moving averages are about to produce a death cross - a bearish, but a lagging indicator, which trapped sellers on the wrong side of the market in April 2018 and September 2015.

The RSIs on the hourly and 4-hour charts are reporting oversold conditions with a below-30 print.

The outlook would turn bullish if and when prices rise above the Oct. 20 high of $8,352, invalidating the bearish lower highs setup on the daily chart.

Bitcoin image via CoinDesk archives; charts by Trading View.