BTCUSD is dropping like a stone towards our first target. It's currently trading under 25K, which we hinted at here. However, we changed the measured move of the wedge pattern to reflect more accurately in this article, giving the first target of 20K. As long as the stochastic stays below 20 (green rectangle), the underlying momentum will continue to pressure the cryptocurrency, making the target more probable. Moreover, the RSI is not oversold (blue square), implying that there is scope for further decline before a floor is in place.
Several factors are adding to the bearish sentiment gripping bitcoin. Firstly, Celsius Networks LLC, whose platform allows bitcoin and other crypto deposits to earn interest, has halted withdrawals. Celsius has cited that this is "due to extreme market conditions." Secondly, the higher-than-expected CPI prints on Friday suggest a much more hawkish central bank contractionary policy. This tightness will hurt risk assets and adds to bitcoin's headwinds.
Senior Market Specialist
Russell Shor joined FXCM in October 2017 as a Senior Market Specialist. He is a certified FMVA® and has an Honours Degree in Economics from the University of South Africa. Russell is a full member of the Society of Technical Analysts in the United Kingdom. With over 20 years of financial markets experience, his analysis is of a high standard and quality.