Bitcoin has been trading inside a descending channel for quite some time and is currently testing the resistance at $6,800. If this continues to hold, price could fall back to the channel bottom or the Fibonacci extension levels marked on the chart.

The 38.2% extension is close to the mid-channel area of interest and could still spur a bounce. The 50% level is closer to the $6,000 major psychological support and the 78.6% Fib is near the bottom of the channel at $5,600. Stronger selling pressure could take it down to the full extension at $5,268.40.

The 100 SMA is below the longer-term 200 SMA to signal that the path of least resistance is to the downside. This suggests that the selloff is more likely to resume than to reverse. The 100 SMA is close to the channel top as well, adding an extra layer of resistance on another bounce higher.

RSI is turning down from overbought levels to reflect a pickup in selling pressure. Stochastic also seems to be moving back down without hitting overbought territory to signal that sellers are eager to return. A move past the channel top, on the other hand, could lead to a test of the 200 SMA dynamic inflection point.

Bitcoin recently drew support from news that the New York FSA gave a license to Square’s Cash mobile app, which would allow its clients in the state to trade bitcoin from their smartphones. This would bring more liquidity and volumes, apart from representing a positive update in the industry in a long time.

However, the US dollar remained supported as safe-haven flows resumed on Trump’s threat to impose more tariffs on $200 billion worth of Chinese goods. This has already dampened investor sentiment on Wall Street, particularly for stocks of companies that have business with China, and it wouldn’t be a surprise if it weighs on overall risk appetite.

The post Bitcoin (BTC) Price Analysis: Bears Waiting at Channel Top appeared first on Ethereum World News.