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Bitcoin Pulls Back Again After Japan Aims To Change Regulations

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Bitcoin hits resistance at $9k amid the possibility of a pullback

Bitcoin’s repeated failure to break the resistance at around $9,000 was followed by a pullback in prices, as shown in the technical charts.

The short-term bullish reversal was signaled on Tuesday when the cryptocurrency surpassed the $9000 mark. Nevertheless, BTC trading range remained inside the area between $8700-$9200 according to Coindesk’s Bitcoin Price Index.

The price hike above 9,000 was in line with the latest Tether’s token issue. The number of newly issued tokens reached almost $300 million, meaning the company printed almost $850 million new USDT in a year. The release of new tokens triggered a prospect of a rally, according to comments on social media.

However, the bitcoin price moved sideways followed by a pullback. At the time of writing the price is testing the support levels at around $8500.

The surplus of sellers on the market is not surprising as BTC prices moved upwards steadily without an evident correction coming from the low of $7,335 on March the 18th. The key resistance levels are in the $9,200-9,500 range. Should the price breach those levels, there could be another rally.

Furthermore, the upside is currently capped by the descending 100-day moving average according to the 4-hourly chart.

The 200-day SMA (simple moving average) still has an underlying upward trend. Since the last major drop to 6,000$, the price has never reached an oversold area. As the current longer trend still classifies as a correction, it is possible that the price will head down to a closer point to 200 SMA before a more significant bounce with more aggressive buys.

Currently, the BPI (Bitcoin Price Index) stands at $8,587. The global average price, shown by Coinmarketcap is based at $8,646,

According to chart analysis, there is a possibility of a further pullback if the support at $8,350 doesn’t hold.

The hourly chart

Bitcoin-pullback

At the time of writing, the hourly chart (prices as per Bitfinex) is showing a rising wedge reversal (a bearish continuation pattern) and a double top pattern with a neckline support at 8,550$. The price dropped to a 200-hour MA (moving average) at 8,377$ before bouncing back slightly.

The daily chart

Bitcoin-daily-chart

As shown on the daily chart, Bitcoin created a doji candle yesterday at the 200-day MA resistance, signaling some indecision among investors. The corrective rally from the low of $7,240 has ended as the price dropped below the previous day’s low of 8,752, meaning there is a possibility of a pullback to recent lows below $7,300. Should there be a more bullish scenario, the price would have to break the resistance levels at $9,500.

 

 

 

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Stefan Grasic (Dipl.-Jur) is the World Wide Director of research for Buisness24-7 and has considerable experience in the financial and investment niche, but also enjoys writing articles for the general readership. Stefan is an active Crypto, Forex and general investment researcher advising blockchain companies at their start up level. He keeps fit by mountain biking, surfing, skiing and lots of other adrenaline sports.