If historical data are anything to go by, then the leading cryptocurrency, Bitcoin may be ready to end its three year December winning streak unless of course the price of Bitcoin convincingly breaks through the resistance at $4,410 in the next couple of days.
Statistics revealed that the leading cryptocurrency by market cap has in the last three years gained 14 percent, 30 percent and 40 percent respectively. However, as things now stand, the current bearish market may put an end to that winning streak.
If you’ve been following the recent happenings in the cryptocurrency markets, you’ll notice that since BTC broke below the 21-month exponential moving average (EMA) last month, there had been a resumption of massive sell-off. What this means is that the bears are now fully in control of the markets especially as the markets continue to trade below the key EMA at $5,747.
Another thing you should take note of is that the recent corrective bounce off the $3,500 price mark ran out of steam at $4,410 last week, this has further given credence to the bearish sentiments validated by the break below the 21-month EMA.
Again, historical data shows that the leading cryptocurrency broke a similar three-year winning streak in December, 2013.
Nevertheless, Bitcoin may also continue its winning streak past this December should price convincingly breaks the new resistance formed at $4,410. As at the time of writing this report, the leading cryptocurrency is exchanging for $3,798, representing a 3.57 percent drop from its monthly opening price of $4,024.
A look at the chart above reveals that the bullish divergence of the 14-day relative strength index (RSI) confirmed last Wednesday has so far failed to produce any upside momentum. This shows that the bearish sentiments are still very strong.
More so, the BTC doji which was formed on Thursday indicated indecisions in the market, and despite the bullish divergence formed on the chart, the price of Bitcoin has now fallen below the $4,000 price, confirming an end to the corrective bounce. What this now means is that Bitcoin has now carved out a lower high (bearish pattern) at $4,400.
Again, the 5 and 10-day moving averages are pointing south indicating that the bearish market may continue for some time. To this end, the cryptocurrency may once again test the recent low of $3,474.
Notwithstanding, a break above the $4,400 will renew the bullish perspective of the market and hopefully push the price to the psychological resistance of $5,000.
Another look at the weekly chart shows that BTC has formed a descending triangle breakdown (bearish continuation pattern). That’s not all, the downward sloping 5- and 10-week EMAs all points southwards. Again, the 14-week RSI is holding well above 30.00, this means that a move towards $3,000 may happen sooner than expected.