Earlier today, the cryptocurrency was trading at $7,591 on the Bitfinex trading platform, which briefly shut down this morning following a cyber attack.
Bitcoin was on the defensive on Monday and it appeared the cryptocurrency could slump to a recent low of $7,040, courtesy of the price failing to have enough momentum to push through resistance in a move called a ‘failed breakout’.
A rising-wedge breakdown, the pattern that shows up in charts when the price moves upward with pivot highs and lows converging toward a single point, also contributed to Monday’s activity.
But sellers ran out of steam at $7,372 on Monday and prices gradually moved back above $7,600 in Asian trading markets today.
The popular cryptocurrency has plummeted more than 30 percent from a recent high of $9,990, meaning Bitcoin is currently firmly on the back foot.
The fear of getting trapped on the wrong side of the market may have forced traders to stay on the sidelines, and the cryptocurrency is still treading water as seen in the chart below (pictured).
The rising-wedge breakdown remains intact as long as Bitcoin continues to trade below its June 3 high of $7,780.
It means the downside is still in play and the sell-off could accelerate if the support at $7,372 is breached.
Breaking the $7,780 milestone could signal a bullish trend reversal.
In this case, prices would likely move to the 10-week moving average, currently standing at $8,310.
A break below $7,372 would put the focus back on the rising-wedge breakdown and accelerate a drop to $7,040.
Bitcoin was released in January 2009 and according to research from the University of Cambridge, there were up to 5.8 million unique users using a cryptocurrency wallet last year, most of them Bitcoin.