Bitcoin Price Plunges To $7000: Will The Historic Support Line Save Bitcoin?

Just yesterday, we had celebrated the goodbye party from the $8000 price level, which held Bitcoin for the past couple of days.

Yesterday’s bloody action reached down to the significant support area of $7400, which was the lowest price level before the vast 42% price surge on October 26, which ended up touching $10,350.

It’s not even a month later, and Bitcoin is down again, struggling with the low levels, marking $7000 as it’s current daily low (as of writing this). This is a new low for Bitcoin, and the lowest Bitcoin had seen in the past six months, since May 17.

Looking on the following daily chart, Bitcoin touched a historic support trend-line, which started forming in April this year. So far, the support line, along with the psychologic level of $7000, holds well. However, things can change at any minute.

After such severe decline and five consecutive daily candles (in case today won’t surprise), the market is bearish without a doubt.

Total Market Cap: $197 billion

Bitcoin Market Cap: $130 billion

BTC Dominance Index: 66.0%

*Data by CoinGecko

Key Levels to Watch

– Support/Resistance: After breaking down the $7400 support, this level had now turned into the first resistance. Further above lies old support at $7700 (which was confirmed as resistance during yesterday’s price action).

From below, the $6K prefix is closer than ever: In case $7000 gets broken down, there is not much demand till the $6200 area. There might be some support at $6600, but the panic could quickly get Bitcoin to $6000 and even below ($5400 -$5600

– The RSI Indicator: As said here yesterday – the RSI looks very bearish. Since yesterday the RSI discovered new lows, now encountering the 25 levels, which might halt the declines for a bit.

Stochastic RSI oscillator is pointing on oversold on the 1-day chart (for the past ten days already). This can lead to a possible positive correction in the case of a cross-over.

– Trading volume: The bears are here. After no significant volume days, yesterday seen the highest volume day since the end of October. Blood on the streets.

BTC/USD BitStamp 1-Day Chart