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Bitcoin (BTC) is currently trading at around $5,300. A breakout was seen above the resistance of $5,315, but it appears to be a false breakout and was confirmed by the formation of hanging man pattern. Hanging Man pattern is bearish pattern, which indicates trend reversal.
After the formation of the pattern, we see price moving downwards. The support is around $5,149 and resistance is at $5,315. The range between support and resistance can be used for swing trading.
BTC price is currently in the distribution phase, a period in which informed buyers sell (distribute) their positions. This is the opposite of the accumulation phase (which was seen before) during a bull market as informed buyers are now selling into an overbought market instead of buying in an oversold market.
In this phase, overall sentiment continues to be optimistic, with expectations of higher market levels. It is also the phase in which there is continued buying by the last of the investors in the market, especially those who missed the big move but are hoping for a similar one in the near future.
The price is moving between the channels. In addition, the RSI is neutral neither it is in oversold or overbought region, but is going down. Therefore, near term trend is bearish.
When taking 9 period moving averages (blue) with 21 period moving averages (red), only a bullish crossover is seen but the price is trading below the 9 period moving average and 21 period moving average, which is an indication of a downward rally.
Bitcoin (BTC) is currently trading around the $5,300 level with the resistance level at $5,315 and support at $5,149. This range between support and resistance can be used for swing trading. As per Dow Theory, the price is currently in the distribution phase, and we might see corrections during this phase. RSI is neutral. Moving average indicate a downward trend.
Therefore taking long positions is not suggested, and you should wait for some indicator to turn bullish or the price to touch support. Overall, long-term outlook is positive but in the short term we can expect some minor corrections.