After last week’s minor collapse on Bitcoin following news from China, there’s been a decent recovery, with consolidation now coming in to play.
Let’s take a closer look at the BTC/USD chart on the H4 timeframe (click to expand):
I’ve performed the Fibonacci study from the high at 465 to this month’s low at 342. A drop of more than 25% in barely half a week. Painful stuff for bullish crypto coin speculators, but the good news is that the recovery was more than a minor retrace, rising back up to the 78.6% Fib level at 438.
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Since then, we’ve not seem much activity quite frankly, and if we performed a more short term Fibonacci study, as below, we can see how price has just about dropped to the 23.6% level at 417:
It’s interesting to note that the 61.8% Fib level from the first chart is at the same location of the 23.6% Fib level from the second chart.
With the Stochastics now heading down from an overbought zone, we may see price hit 38.2% (from the second chart) later today at 403, with 400 providing some support due to it being a psychological whole number.