BTC/USD Signal 26/08: Bitcoin Flash Crashes (Chart)

(MENAFN- Daily Forex) Bearish view

• Sell the BTC/USD pair and set a take-profit at 105,000.
• Add a stop-loss at 112,000.
• Timeline: 1-2 days.

Bullish view

• Buy the BTC/USD pair and set a take-profit at 112,000.
• Add a stop-loss at 105,000.

Bitcoin price has crashed in the past few days as the recent bull run faded. The BTC/USD pair moved to below 110,000, its lowest level since July 9 this year. It has plunged by 12% from its highest point this year, meaning that it is in a correction.

Bitcoin crashed as the recent enthusiasm about the Federal Reserve interest rate cuts faded and as investors took profits. In a statement on Friday, Jerome Powell hinted that the bank would cut rates.

While the stock and the crypto markets rose initially, things changed on Monday. The Dow Jones, Nasdaq 1o0, and the S&P 500 indices retreated by over 0.50%. Similarly, the US Dollar Index (DXY), which initially slumped after his statement, rose by almost 1% on Monday.

The BTC/USD pair also slumped as investors embraced a cautious tone ahead of the upcoming NVIDIA earnings on Wednesday. These numbers will help to determine the trajectory of the stock and the crypto market because it is the biggest company in the United States and the top beneficiary of the AI industry.

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The daily chart shows that the BTC/USD pair has been in a strong downtrend in the past few days. It moved from a high of 124,000 earlier this month to 109,000 today. The pair formed a double-top pattern and a neckline at 112,000, its lowest level earlier this month.

Bitcoin price dropped below the 23.6% Fibonacci Retracement level at 112,600. This level coincided with the neckline of the double-top pattern.

It has also moved below the 50-day and 100-day Exponential Moving Averages (EMA), a sign that bears are in control for now. The Relative Strength Index (RSI) has plunged below 50 and is still pointing downwards.

Similarly, the two lines of the MACD indicator have moved below the zero line. Therefore, the most likely scenario is where the pair continues falling as sellers target the 38.2% Fibonacci Retracement level at 105,300. A move above the resistance point at 112,000 will invalidate the bearish outlook.

EURUSD Chart by TradingView

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