Bitcoin’s price declined to a low of $45,673 while on-chain data points toward a substantial drag down to $40,000.
On Monday, Bitcoin’s short-term outlook started to worsen after its price dropped at $45,673, far from the weekend’s promising comeback beyond the $50,000 level.
With the year almost finished and all-time highs near 35% away, traders are trying to readjust their expectations while driving the $100,000 BTC target into 2022.
Day traders and over-leveraged longs seem to freak out.
Overview of the BTC price
The daily timeframe clearly shows that the price struggled to leave the trend of daily lower highs. Besides the drop to $42,000, traders seem to be anxious to buy the most current dips.
Tracking moving averages is simple to swing trade BTC. Some traders like to buy when an asset confirms a few daily closes beyond the 20-MA and sell when the price drops below it. They do it because they see it as a sign that the short-term trend is becoming weaker.
After this, traders might need to wait for Bitcoin to ensure a daily close beyond the moving average at $54,000 before it opens new long positions.
Some traders expect more downsides
Experienced traders understand that Bitcoin’s price tends to make M-tops, double tops, and several other patterns after beating new all-time highs. Lately, analysts pointed to a double top, representing a clear trend reversal pattern.
Looking at the daily time frame, traders can easily see the start of a head and shoulders pattern. The recent dips and consolidations might finally complete the shoulder, with a neckline at $41,600.