Bitcoin price broke below its rising wedge consolidation pattern, also after hitting the resistance on a longer-term falling wedge formation. This signals that price could slide all the way down to support or at the long-term floor around $5,800.
The 100 SMA is still above the longer-term 200 SMA on this time frame, though, after it just recently completed a bullish crossover. Bitcoin has fallen back below these dynamic inflection points to indicate that they might hold as resistance moving forward.
RSI is on the move down but has already reached oversold levels. This means that sellers are feeling exhausted at this point and might be willing to let buyers take over. The oscillator needs to turn back higher for this to happen.
Stochastic is also pointing down to indicate that sellers have the upper hand, but this oscillator also dipped into oversold territory. Pulling higher could allow bitcoin to follow suit as buyers return or sellers book profits.
News that Goldman Sachs is backing off its plans to create a bitcoin trading desk turned out to be a sharp blow to institutional interest, possibly convincing other smaller banks to think twice about similar offerings.
This also dampened hopes of seeing the SEC approve bitcoin ETF applications as officials raised concerns about cryptocurrency markets and the potential for manipulation or fraud. Goldman Sachs spokesperson Michael DuVally told Reuters:
“At this point, we have not reached a conclusion on the scope of our digital asset offering.”
Still, the Business Insider report indicated that the bank still plans on creating a custody offering for crypto, which will allow it to hold cryptocurrency on behalf of large clients and track its price.
Some remarked that the drop was worsened by the introduction of new registration steps on ShapeShift’s instant bitcoin trading platform.