Bitcoin which had earlier regained the $9,200 level days back was struck a devastating blow as it crumbled under pressure to trade below $8,400.
A day before, the asset had earlier printed a “Darth Maul Candle” which saw BTC rising by a percent in a few minutes to nosedive by 3 percent in 3 mins, then sustain its downtrend flunking around its support.
A “Darth Maul” candle is usually typified by a whipsaw wick to the top and a whipsaw wick to the bottom with a small body. A top trader who had foreseen the asset’s downward trend when it hit $9,200 claiming it did so based on high volume explained further that when “Darth Mauls” spike upwards, then go down, most times it is bearish and the downward trend is sustained.
Analysts who had observed the crypto asset’s movement with keen eyes noted three phases in its downward trend, first on Saturday in which it fell from its previous high of $9,200 to $8,900, then it was dealt a second blow which saw it plummet from $8,900 to $8,700 in the early hours of Sunday. The biggest blow it suffered saw it tumbling from $8,700 to trade beneath $8,400 liquidating a total of $92 million BitMEX contracts.
At the time of this report, BTC trades at $8,224 down from its previous highs of $9,200 plunging by 10%.
BTC’s Next Move: Ranging or Downtrend?Although the “Darth Maul” candle is a strong bearish indicator, analysts still hold the positive opinion of BTC rebounding in the short term.
A renowned trader, Big Cheds sees BTC finding support at $8,400 as in three futile attempts over the last few weeks, it had met resistance at the $8,400 level.
In a contrary opinion, Burger Crypto, a top executive at Crypto Investment sees BTC’s bearish momentum sustained plummeting to fresh lows of $6,000 in the near term. This he gathered while looking at the BTC daily chart which he noted had formed a feasible head and shoulders.
On the technical analysis chart, the head and shoulders formation occurs when a market trend is in a reversal process from either a bull or bear trend, which is characterized by a baseline with three peaks, the outer two are close in height, and the average is the largest.
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