- BTC/EUR extends rout as correction in the crypto currency market continues.
- The pair has broken major support levels and we see scope for further downside.
- Technical studies are heavily bearish. We see -ve DMI dominance which supports further downside.
- RSI and Stochs sharply lower, momentum heavily bearish. 5-DMA is sharply lower and Bollinger Bands are widening.
- That said, momentum indicators on daily charts have entered oversold zone which calls for some caution.
- Break below 78.6% Fib retrace at 5488 now sees bears target 88.6% Fib at 4092.
- On the flipside, 200-DMA at 6636 is immediate resistance, close above to invalidate bearish bias.
Support levels - 4736 (Nov 12 low), 4342 (Oct 18 low), 4092 (88.6% Fib),
Resistance levels - 5488 (78.6 % Fib retrace of 2502 to 16457 rally), 6000, 6351 (5-DMA), 6636 (200-DMA)
Recommendation: Good to go short on rallies around 5500, SL: 6640, TP: 4740/ 4350/ 4100.
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