The start of the week has begun with a small retracement for the price action of the market leader Bitcoin. Price action over the weekend saw significant increases across the market with altcoins outperforming. We are seeing more of the same today as many altcoins are showing good returns. Ripple’s XRP is the best performer in the top ten with an over 12% over the past 24 hours.
The retracement for Bitcoin is on low volume showing there may be little strength behind it. Bitcoin has been trading in a triangle pattern since March, and this retracement keeps the price within the triangle pattern. This could be the main driver behind the drop. With altcoins outperforming, the share Bitcoin represents of the total market cap has dropped to 52.1%. This still represents a huge share of the market cap and how Bitcoin ends this triangle pattern is likely to have a corresponding impact on altcoins.
The retracement we are seeing was preceded by a bearish divergence taking place on the hourly chart where price formed a higher high, but RSI formed a lower high showing buying pressure falling off. Price has since formed a series of lower highs, but the most recent low has been higher showing some consolidation.
With higher amounts of trading activity in the altcoin market than normal, it is possible that we could see a spike in trading activity for Bitcoin today along with some significant moves. With the increases being seen in altcoins and price action trading towards the upper trend line of the triangle, the outlook for Bitcoin is slightly more on the bullish side.
- Bitcoin retraces despite strong performances in altcoins.
- The retracement keeps Bitcoins price action within the triangle pattern it has been forming since March.
- A bearish divergence preceded Bitcoins retracement. It has since started to consolidate, but a spike in trading activity is possible today given the activity in altcoins.
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