Bitcoin Price Trapped Below $8,500 as Bears Call for a Drop to $6K

Around this time last week, the situation was looking increasingly dire for Bitcoin and murmurs of a drop to $6,000 and even $3,000 began to circulate amongst traders.

Since the drop from $10,300, Bitcoin has been pinned in the $8,000 to $8,400 range with support at $8,000 and $7,850.

One can see that Bitcoin price has ridden right along the MA of the Bollinger Bands and met resistance once breaking above the upper arm in the $8,520 area.

There has been much talk about the importance of the 200-MA and while it is an important point that Bitcoin should stay above when in a bull market, traders might also focus on the 111 daily moving average.

Philip Swift's 2-Year MA multiplier and his Bitcoin Golden Ratio Multiplier show Bitcoin's current price action is nothing out of the ordinary and while no-one can call it, a bounce from the 2-year MA is bound to happen at some point.

A third failed attempt to surmount $8,528 could be the final straw that sees BTC drop below the 20-MA on the 4-hour Bollinger Band and price could drop to $8,175 or the local bottom at $7,720.

While many abject to this assessment, a drop below $7,300 opens the doors to a potential visit to $5,700 where interest for BTC is shown on the VPVR.Of course, there is always the possibility that bulls front-run Bitcoin price before it drops this low but similar to any asset, nothing can ever be assumed and nothing is ever guaranteed.

A move to $9,000 would bring Bitcoin back above the base of what was once a massive descending wedge at closer the 20-MA of the Bollinger Band indicator which is currently at $9,200.

In summary, Bitcoin appears well situated above $7,800 and alarm bells should go off if it dips below $7,300.

Continued rejection at $8,200 and $8,500 could increase the chance of Bitcoin falling below $7,300 to the $6,500 to $5,700 range.