Bitcoin price remained in a tight range on Saturday as the hash rate fell, and bearish divergence formed, risking a bearish breakout.
Bitcoin (BTC) was trading at $94,296 at last check as the market reacts to the latest report from the Bureau of Labor Statistics showing that the U.S. economy created over 256,000 jobs. The unemployment rate fell to 4.1%.
As a result, American equities fell, with the Dow Jones and Nasdaq 100 indices falling by 697 and 317 points, respectively.
As crypto.news expected, the bond market continued its sell-off, with the 30-year yield rising to 5.0%. The 10- and 5-year yields rose to 4.76% and 4.57%, respectively. The rising yields indicate that the market expects the Federal Reserve to maintain a hawkish tone, which typically affects risky assets like Bitcoin and altcoins.
Source: CoinGecko
You might also like: Bitcoin price is still bullish despite recent weakness: legendary trader
Meanwhile, data by IntoTheBlock shows that Bitcoin’s hash rate has retreated in the past few days as its price has stalled.
It had a hash rate of 750 TH/s on Saturday, Jan. 11, lower than the 30-day high of 911.88 TH/s and the 30-day average of 793 TH/s.
A hash rate is an important number that looks at the speed at which mathematical puzzles in the network are being solved.
Bitcoin hash rate | Source: IntoTheBlock
More on-chain data shows that the number of active Bitcoin addresses has retreated to 775,000 from 900,000 on Monday, a sign that some traders have started to sell. For example, according to SoSoValue, all spot Bitcoin ETFs had outflows totaling $572 million in the last two consecutive days.
Bitcoin price forms a bearish divergence
Bitcoin price chart | Source: crypto.news
The daily chart shows that Bitcoin is at risk of a bearish breakout. It has formed the risky head and shoulders chart pattern, whose neckline is at $90,952. This is one of the most popular bearish patterns in trading.
Bitcoin’s Relative Strength Index and the MACD indicators have formed a bearish divergence pattern. The MACD’s histograms have moved below the zero line.
Therefore, a break below the H&S’s neckline at 90,950 risks further downside. The first support of this will be the 200-day moving average at $78,285 followed by $73,985, the highest point in March last year.
On the positive side, as we wrote earlier this week, Bitcoin price is forming a bullish pennant chart pattern on the weekly chart. That pattern will remain in play as long as it is above $90,000.
You might also like: 3 reasons why Bitcoin price may surge to $123k in January
Read the full article here
