Technical and past data suggests December range-trading may soon be over.
BTC Sideways Market
Figure 1a: BTCUSDT 4-Hour Chart (Source: OKEx; Tradingview)
Figure 1b: BTCUSDT 4-Hour Chart Bearish Engulfing (Source: OKEx; Tradingview)
Short-term Bias Towards Downside; Volatility Set to Increase?
Figure 1b shows that BTCUSDT has produced multiple 4-hour bearish engulfing patterns recently with increased trade volume. That could indicate sellers have overtaken buyers and driven the price lower. A retest of the lower end of the December channel is getting more likely if the short-term pressure persists.
Figure 2: BTCUSDT Daily Chart (Source: OKEx; Tradingview)
We would also like to highlight that BTCUSDT still hasn't touched the lower Bollinger band on a daily chart. However, momentum indicators suggest that there’s still room for the price to go a little lower.
The 9-day RSI has been staying at around 35 recently after reaching 50 earlier this month, which, 50 seems like a significate level for BTCUSDT (red arrows). The pair had shown a behavioral rebound when the 9-day RSI touched or went below 30. Therefore, the current RSI reading of 35 suggests that the price may still have further room to go lower. Besides, the stochastic oscillator also suggests the same thing, strengthening a short-term bearish case.
OKEx BTCUSD Index Suggests Price Fluctuation Ahead
Table 1: OKEx BTCUSD Index Monthly Ranges (Source: OKEx)
Figure 3: OKEx BTCUSD Index Daily Chart (Source: OKEx; Tradingview)
It’s worth noting that higher market volatility doesn’t necessarily mean the price goes down, a significant price surge could also bring up the overall market volatility.