Bitcoin continued its losses on December 29th with a striking new drop, pushing the price below $ 46,600.
BTC price 4-hour chart | Source: TradingView
RSI flashes “oversold”
Bitcoin fell ahead of Wall Street’s opening, increasing the 48-hour correction to 10.4%, according to data from TradingView.
The latest move comes within a known market and behavior pattern that suggests that the range Bitcoin was in in December will persist.
While market participants are doomed to end a lackluster year-end, prominent analyst and trader Scott Melker sees current levels as a potential buying opportunity in a short space of time.
Bitcoin’s Relative Strength Index (RSI) entered the “oversold” territory along with other bullish signals during a classic buy trigger decline.
“When you are trading in the tight timeframes there is a very solid risk / reward ratio if you bet long here. The oversold RSI on the hourly chart is on the verge of a bullish divergence, in the EQ area, little selling activity with minimal volume, ”he wrote in several tweets about buying opportunities.
Nice bullish divergence with an oversold RSI on the hourly chart. Small timeframe so I’m looking for the div to build on higher timeframes. The 4 hours would come next.
As I said, great R / R potential for a trade here up to the 50Ks. pic.twitter.com/a6T0sPCG6X
– The wolf of all streets (@scottmelker) December 29, 2021
“Nice bullish divergence with the oversold RSI on the hourly chart. The time frames are small so I look for bullish divergences to build higher time frames. The 4 hour timeframe is the next goal. As I said, the potential risk / reward ratio for a trade here is great as the price moves back into the $ 50,000 region. “
BTC then rebounded from the lows and returned to above $ 47,000.
Melker previously defended the $ 52,000 retracement, arguing that “nothing has changed” for Bitcoin range trading overall.
Brandt: Massive sell-off “not yet happened”
However, not all are optimistic.
The experienced trader Peter Brandt warned at the beginning of the week of a “fake breakout” on the thin markets over the holidays. He currently sees the possibility of further cuts.
Has to happen … https://t.co/o4I4KuVMNf
– Peter Brandt (@PeterLBrandt) December 29, 2021
The advent of a period of “panic surrender” worse than early December is still a matter of debate.
Retail investors may not be inclined to bulk sales at the current levels, as evidenced by the growing number of wallets with small account balances and strong Hodl behavior throughout the year.
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