After yesterday’s news that the People’s Bank Of China (PBOC) intends to close accounts used by Bitcoin Exchanges, it naturally followed that Bitcoin’s price was going to slump. Hence, price has fallen from a high of yesterday of 588 until a low today at 472.
Let’s take a closer look at the BTC/USD H1 chart below (click to expand):
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I’ve performed the Fibonacci study from the two points mentioned above, i.e. from 588 till 472.
As can be seen, price did manage to perform a 50% retrace (circled in red), at 530. I have to say that’s a pretty strong retrace for a piece of bad coin press.
However, since the 50% retrace, price then continued to fall down until the 23.6% Fib level at 500. Of course, 500 is a significant number as it’s a psychological whole number.
Right now, price is hovering around the 23.6% Fib level (500), but with the Accelerator Oscillator and Awesome Oscillator having turned red, and the Stochastic Oscillator also crossed down, we could see a further drop to around the lower Bollinger band, as long as 23.6% / 500 (which is now a support), level fails to hold.