TL;DR a key rising support line is holding – kind of – for now.

Bitcoin has provided a series of surprises over the last week or so. After failing to breach resistance at $10k (as expected) BTC dropped sharply. But unexpectedly, it fell a lot further than the next obvious support. The Consensus event failed to produce the desired hype and market catalyst, and bitcoin plummeted under $8,000.

There is a strong rising support line that has withstood every major dip in the past year. Every time bitcoin crashes, that support line holds, producing a series of higher lows. BTC has touched or come very close to it four times already: in July and September, in February with the capitulation to $6,000, and in April with the drop back to $6,500. Yesterday it touched bumped against it for a fifth time, as the price fell below $7,300.

Looking at the daily candle, BTC came about as close as it’s possible to come to breaching that line, dropping below it before recovering so that the base of the candle rests on the line with the wick falling underneath it. It’s a very strong support line, now being confirmed five times, but the fact that BTC is trading around these levels is cause for anxiety among traders. Closing the day below around $7,300 would indicate that further falls are very likely.

Right at this point BTC seems to be consolidating, though it’s still very early days and a large sell could prompt a major setback. A rise back above resistance at $8,000 is really what’s needed to bring some degree of confidence back to a now fragile market. In the meantime, be wary of whales painting the tape and putting in a big sell to induce panic.

Elsewhere in the bitcoin world, we have the news of Tether printing another 250 million USDT last week – somewhat bullish, because that indicates significant demand. Bitcoin Gold has been hit by a double spend attack (https://www.ccn.com/bitcoin-gold-hit-by-double-spend-attack-exchanges-lose-millions/), showing that proof-of-work has its drawbacks if your network isn’t vast and robust. A criminal probe into BTC price manipulation has been launched (https://www.bloomberg.com/news/articles/2018-05-24/bitcoin-manipulation-is-said-to-be-focus-of-u-s-criminal-probe). And in terms of the big political-economic picture, Donald Trump has called off Korea talks, so the world just became a slightly more dangerous place. Thanks, Don.

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