BTC-“Watch-out for Short-Coverings”

4-Hour Analysis:

Big Picture: Bitcoin has stayed under pressure for the most part after dropping below the range lows. Several attempts were made to regain the lost psychological area, but none were successful. All of this maintained pressure, which has finally resulted in the pair breaking lower. Momentum indicators are now in a very oversold zone, which may drive some aggressive short-covering. Such oversold conditions were last experienced in early June.

On the Upside Bitcoin sees a handful of resistances. The prior levels that served as supports are now to be established as opening resistances. The initial resistance is expected at levels of 28,650 to 28,850, followed by levels of 28,940 to 29,010. Price may re-test these levels in the coming hours as short-coverings push the price higher. To revive strong momentum and buying interest, the price must rise beyond the psychological resistance level of 30,000.

On the Downside there are only a few supports between 28,400 and 28,200 levels. These supports helped ease some of Bitcoin’s pressure. Moreover, the oversold circumstances may play a key role in enforcing short-coverings for the session. However, if the selling continues and the support level of 28,200 is broken, another round of decline is possible, with objectives of 27,520 to 25,200 levels.