BTC/USD Technical Analysis – 10th April 2014

Bitcoin falls to 400 following multiple pieces of bad press worldwide, including but not limited to: – Huobi, one of

Bitcoin falls to 400 following multiple pieces of bad press worldwide, including but not limited to:

– Huobi, one of the world’s largest bitcoin exchanges, announcing they’ve received notice from their bank, ICBC, that they will be closing Huobi’s account next week.

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– BTCTrade, another Chinese bitcoin exchange announcing likewise.

– The National Australia Bank is to dissolve any relationship with digital currencies, citing there’s too much risk involved.

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All this bad news means one thing, further bears for Bitcoin and altcoins. Let’s check out the latest BTC/USD hourly chart below (click to expand):

btcusdh1_10_04_2014

As I explained in my previous analysis, there was a Bollinger Squeeze in place, marked with a white ellipse. There’s always an expansion after a squeeze, often sparked by some major news, such as those mentioned above. Consequently, price fell to 400, which, due to it being a psychological round number, has provided some support for the meantime.

Take a look at the two candles circled in blue; both of them opened and closed below the lower Bollinger band, a rare price action occurrence. Unsurprisngly, price has since tested the 23.6% Fibonacci retracement level. With the Stochastics heading north and the AC & AO both red, I expect further tests within the next few candles.

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