We are concerned that the next big move in Bitcoin ( BTC ) could be down. Bitcoin ( BTC ) has been unable to rally up to above its 21-day or its 200-day moving average. Each rally gets more and lame. Each day that passes, this listless dead price action reminds us more and more about what happened in the fall of 2018. We think active traders can try to be short here, and long term holders should consider hedging.

Bottom Line: All the reasons we had for Bitcoin ( BTC ) to rally did not produce a bullish breakout. So, we have to develop a strategy for the downside. If Bitcoin ( BTC ) breaks 7800, and the returns to that level and fails, the next target could be as low as 7400. We are also concerned that there is very little support below 7400. So, any decline could feed on itself. Said differently, lower prices could bring in more and more sellers.

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