Why is Bitcoin Price Down Today? Have the Bears Capitualted the Markets?

Bitcoin’s value dropped notably during the previous day’s close, hitting the intraday low of $23,000, incurring a loss of more than 3%. The drop was followed by a significant drop in the US markets as the Dow Jones Industrial Average plunged by 390 points and S&P500 & Nasdaq dropped by 1.6% and 2.0% respectively.

The price was fluttering around the crucial support level of $23,800 for a long time, and hence a giant action was expected, regardless of the direction. One of the prime reasons is assumed to be the release of monthly personal consumption expenditure, which rose by 0.6%, surpassing the forecast of 0.3%, fueling the heated inflation. 

So what’s next? Will Bitcoin slide down below $22,000 or regain its strength to rise beyond $25,000?

The current trading setup displays the possibilities of a bull trap being accomplished successfully, but the possibility of a bullish reversal still looms.

The BTC price is trading within the rising wedge, and the recent pullback dragged the price to the lower support. The price is believed to hover around these levels for a while and bounce back above $25,000. However, this bullish attempt is expected to fail, and as a result, a massive bearish action may drag the price below $21,500. 

Additionally, the RSI has been maintaining its trend within the upper bands, and despite a bearish outlook, it is displaying a bullish divergence. Therefore, the Bitcoin (BTC) price is expected to stay above $23,000 until the bulls accumulate some strength to trigger a rebound back toward the crucial resistance at $23,800. Clearing these levels may begin with a fine upswing toward the main target set at $25,000.