Bitcoin Price Analysis: BTC/CNY Decline Extends Further
Bitcoin price made a sharp downside move against the Chinese Yuan and the US Dollar. The BTC/CNY pair collapsed and broke the 6000 support area.
Yesterday’s highlighted bullish trend line on the hourly chart of BTC/CNY (data feed via BTCCHINA) was broken to clear the way for a downside move towards 5000.
Bitcoin Price Sharp Decline
There was a report published yesterday by the PBOC about the start of an investigation on Bitcoin. It resulted in a sharp decline in both BTC to CNY and BTC to USD.
The price struggled a lot and broke a major support area at 6000 vs CNY. The downside move was such that the price even did not respect yesterday’s highlighted bullish trend line on the hourly chart of BTC/CNY (data feed via BTCCHINA).
The trend line support along with the 100 hourly simple moving average for BTC/CNY was broken at 6000, which opened the doors for a sharp downside move. The price also moved below the 50% Fib retracement level of the last drop from the 8885 high to 5622 low.
It called for a full swing low test of 5622. The price did not stop there, as there was a break below it as well, and a new low was formed at 5005.
The price is currently attempting a recovery. However, it may face sellers near the 23.6% Fib retracement level of the last decline from the 6400 high to 5005 low. The trend has changed for BTC/CNY in the short term, and any major corrections from the current levels may face sellers on the upside near 5600 and 6000.
The most imp support lies at 5005. The hourly RSI for BTC/CNY is currently recovering from the oversold readings, but it may not last long.
Chart Source – TradingView.com and data feed by BTCCHINA