- Bitcoin suffered a significant drop in the last 24 hours, but the higher-lows pattern on the daily chart is still intact and the outlook remains bullish.
- A daily close below the June 2 low of $9,615 would invalidate the bullish higher-lows pattern and confirm a bearish reversal.
- The case for a drop to $9,615 would strengthen if BTC prints a UTC close below $11,550 today, validating Wednesday’s bearish outside day candle.
- A high-volume wedge breakout on the hourly chart, if confirmed, would imply an end of the pullback and yield a move back above $12,000.
Bitcoin (BTC) has dropped sharply in the last 24 hours, however, the outlook remains bullish with prices holding well above key support near $9,600.
The top cryptocurrency by market value ran into a flood of offers near $13,200 yesterday and fell to a low of $11,164 on Bitstamp earlier today.
Media outlets have associated the sharp pullback with the US Federal Reserve Chairman Jerome Powell’s comments that Facebook’s cryptocurrency Libra “cannot go forward” until serious concerns regarding privacy, money laundering, consumer protection, financial stability are addressed.
While there is no concrete evidence to link bitcoin’s drop with Powell’s comments, the price action does paint a picture that indicates the sell-off was triggered by Powell’s remarks.
As noted by CNBC Journalist Ryan Browne, BTC began falling rapidly from $12,900 immediately after Powell started talking on Libra at 14:30 UTC yesterday.
That said, the bulls were already looking tired, having faced multiple rejections above $13,100 ahead of Powell’s testimony, as noted by CoinDesk Markets,