CoinDesk Analysis: The Weekly Chart Continues to Favor a Drop to the Long-Term Rising Trendline Support of $4100

According to CoinDesk Analysis, Bitcoin (BTC) dropped to $4,200 for a short time. The 14 percent drop witnessed in the last 24 hours has pushed the widely followed 14-day relative strength index (RSI) below 10.00, its lowest reading on record. An asset is considered to be oversold and due for a corrective bounce when its RSI is below 30.00.

A corrective bounce, if any, will likely be short-lived as both descending triangle breakdown and the break of the seven-year-long rising trendline has likely set the tone for a drop to $4,100.

The record low reading on the RSI and the steady rise in long positions indicates scope for a minor bounce, possibly to the descending 5-day EMA, currently at $5,050. The weekly chart continues to favor a drop to the long-term rising trendline support of $4,100. The immediate bearish outlook would be invalidated if a correction ends up pushing prices above the 10-day EMA of $5,424.

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