Bitcoin Bull Run May be Winding Down

In the months since February, Bitcoin has continually surprised us with a strong position and promising bull run indicators. February, of course, was a troubling month for the cryptocurrency and a bull run then seemed nearly impossible. Looking at recent charts, it appears that Bitcoin’s bull run case is taking on many similar traits to those earlier in the year. The momentum needed for Bitcoin to maintain its bull run has slowed and Bitcoin needs to gain significant ground to be seen in a bullish light once again.

Added to the information taken from the Chaikin Money Flow chart, there is also a trend shaping up on the short term charts with lower highs. That means we could see Bitcoin drop to nearly $9,050 or below within a couple of days. That said, if BTC is able to hold its ground at $9,500, prices of more than $10,250 may materialize very soon. Even a close above $10,000 will not be enough to bring BTC into bullish territory, however. Closing above the $11,000 mark would indicate a return to the upward swing.

The Chaikin Money Flow Indicator

The Chainkin Money Flow Indicator (CMF) is a good place to look for information regarding trading trends in the market. In fact, the entire purpose of the CMF is to compare data related to the prices of an asset as well as trading volume. Interestingly, the combination provides reliable results which reflect the real-world desirability, and therefore, trends. When the CMF shows an incline, a bullish run is very likely, whereas when a decline on the same chart rears its ugly head the opposite is true.

It is important to remember that data shown on CMF charts often appear to differ from both the short term and long-term charts. For example, looking at the long term (200-day) moving average, BTC still looks to be bullish. With a $4,000 trading value just five months ago and a current value of nearly $10,000 with a moving average of just over $6,000, it is easy to see how many would consider BTC to be heading north.

Short-term Indicators

Looking at the daily charts, there are other indicators that a bearish trend is incoming. Firstly, the trendline from yesterday had a breaking point of $10,200 and BTC failed to reach it. Instead, Bitcoin fell short by over $300 leaving a candle behind bearing the traits of an incoming bearish run: a situation which also pushed down the moving averages.

The Current Outlook

We expect the price to drop to $9,050 which was the low on July 17th. However, there have been several small rallies as of late near $6,600 and it is likely that they will continue. If the current price holds, there is a very good chance that buyers will prop up BTC, lifting the prices and moving averages. If prices exceed the $11,100 mark, the current bearish trend will make a positive turn.

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