Bitcoin Price Extends Slide as Bulls Struggle to Keep Momentum Alive
Bitcoin’s price was back on the defensive Friday, with the technical charts showing a breakdown of bullish momentum following an early-week rally that saw a large influx of capital enter the crypto market.
BTC/USD Price Update
The bitcoin price is currently trading at $6,442 on Bitfinex, having declined 0.5% from the previous day. The leading digital currency bottomed at $6,412.90 on Bitfinex but saw lower lows on Coinbase. Market-wide volumes were recorded at $4.6 billion, according to latest available data. With the decline, bitcoin has pared its weekly gain to around 0.9%.
The downshift experienced by bitcoin in the last two days has invalidated the bullish trend that emerged earlier in the week. The MACD and relative strength index (RSI) – two key measures of momentum – declined sharply on Friday, based on the 4-hour chart. The BTC price has also fallen back below the 20-period moving average.
At current prices, bitcoin has a total market capitalization of $111.3 billion.
Rally Loses Steam
Crypto assets across the board were down on Friday, erasing impressive gains made earlier in the week. The combined value of all cryptocurrencies in circulation fell to around $213.2 billion, according to CoinMarketCap. On Wednesday, the market peaked at $221 billion.
While there was no immediate catalyst for the decline, profit-taking and extreme overbought conditions for coins like BCH and XRP likely contributed to the market-wide slump. At the height of the rally, bitcoin cash had added more than 53% week-on-week, as investors opened new positions ahead of next week’s planned hard fork.
Although bitcoin eventually followed its main competitor higher, price action for BTC was much more subdued. This is further reflected in the bitcoin volatility index, which tracks how much the BTC price varies over time. As of Thursday, the volatility index was 1.48% over the last 30 days. That’s higher than last month’s nearly two-year low but well below levels seen since the latest bear market began.
Despite the latest string of losses, the cryptocurrency market is on track for a sizable weekly gain. The total market cap has gained $8 billion since last Friday, with trade volumes jumping 25% over that period.
After falling below 52% on Wednesday, bitcoin’s dominance rate is back above that threshold at last check. This means more than 52% of the cryptocurrency market cap is held in bitcoin, with the remainder being allocated to alternative coins and tokens.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
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