Bitcoin [BTC] Price Flash Drop from $9600 Keeps the Bulls Guessing

bitcoin turns south

The price made a higher high on the charts. It reached a high of $9609 swiftly above $9300. However, following the wick above $9590 the price fell to test lows at $9230 in the following moments.

The 1-hour chart of Bitcoin [BTC] projects a lot of volatility in the last few hours.

kraken btcusd
XTC/USD 1-Day Chart on Kraken (TradingView)

According to datamish, $23.21 million longs got liquidated in the last 6 hours in addition to the shorts of nearly $13 million. Moreover, $18.5 million of those long orders were liquidated in the last hour itself.

The quick break-down from the swing highs seems to be shaking the long orders.

Crypto and derivatives trader, SalsaTekila identified the pattern the ‘u’ (mu) pattern on lower time frames chart which is a bearish pattern. However, the with quick buy backs the price is hovering around the resistance of the pattern at $9397.

The price of Bitcoin [BTC] at 3: 00 hours UTC on 3rd February 2019 is $9362.

‘A popular brand of shampoo’

Veteran chart analyst, Peter Brandt, hints on the formation of the head and shoulders pattern on the 4-hour chart via his tweet.

btcusd head and shoulders confirmation
BTC/USD 4-Hour Chart on Bitstamp (TradingView)

The 4-hour depicts how the price fluctuated at the near end of the pattern. Moreover, the pattern is far from confirmation at the moment. A break below $9250 would confirm the bear pattern.

Furthermore, a close above the shoulder and head at resistance near $9400 and $9550, would invalidate the bear pattern altogether.

Heights of Uncertainty

The uncertainty in price in heightened by the rising trading interest on BitMEX. The Open Interest (OI) in Bitmex has been around $1B since last week. Nevertheless, as not been above to break above the resistance at $9600.

According to crypto trader Escobar, there are changes of further big moves in Bitcoin. He tweeted,

#Bitcoin H12 TF- Could see PA test major resistance level ahead. OI now soaring over 1B hinting a big move is coming, not short or long at the moment.

twitter 12-hours
BTC/USD 12-hour Chart Price Analysis (Source: Twitter)

On longer time frames, Bitcoin [BTC] continues to be project bullish tidings with a strong bullish momentum as well. Traders are likely to tap the $8k-$8.5k area heavily looking for a swing to tops, in case of a fall.

Do you think Bitcoin [BTC] will fall to 8k levels or continue towards $10000? Please share your views with us. 

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