On Monday Bitcoin price (BTC) abruptly fell below the $vii,040 support and dropped to $6,800. Every bit recent equally Nov. 22 and Nov. 27, $vi,800 served every bit support then a number of traders had already identified the price every bit the point where Bitcoin would land if the price pulled back.

Cryptocurrency market daily overview. Source: Coin360

Cryptocurrency market place daily overview. Source: Coin360

At the time of writing Bitcoin is struggling to concur $6,600 and if the current level fails to agree, traders will look for the price to follow the familiar pattern of dropping to the long-term descending channel trendline back up at $6,400. Permit'due south take a look at several technical reasons why BTC/USD is now eyeing a new 7-month low.

Bear crosses galore (bear crosses on multiple timeframes)

As mentioned past Cointelegraph analyst Keith Wareing, BTC is resoundingly surly on multiple time frames.

Moreover, yesterday's downside move produced a bear cross on the monthly moving average convergence divergence (MACD) for the first time since June when the indicate line crossed above the MACD line.

MACD flips negative

The monthly MACD histogram too flipped negative, suggesting that further downside could exist in store for Bitcoin.

BTC USD MACD monthly chart. Source: TradingView

BTC USD MACD monthly chart. Source: TradingView

Acquit cross between key long-term MAs

Some other disconcerting sign on the daily time frame is a bearish cantankerous between the 100-day and 200-day moving average, something which co-ordinate to the chart below does not happen often.

BTC USD daily chart. Source: TradingView

BTC USD daily chart. Source: TradingView

Bulls announced to take abandoned the $6.8K bounciness

The daily timeframe as well shows that the relative forcefulness index (RSI) has dipped into oversold territory and the lack of follow-through from traders buying into the dip ways a stiff oversold bounce has yet to occur.

The last time Bitcoin price dipped to $half dozen,522, the RSI dropped to 22 so if the sell-off resumes, the RSI could easily drop to this level once more.

BTC USD daily chart. Source: TradingView

BTC USD daily nautical chart. Source: TradingView

A revisit to the descending channel lower support at $6,400 is not exactly disastrous for Bitcoin price. Traders who clarify the weekly timeframe will think that Bitcoin traded in the $6K region for nigh viii months prior to the November 2022 drop to $3,100.

Furthermore, seasoned traders will recall that every Tom, Dick and Harry had chosen $6K the lesser prior to the Bitcoin Cash (BCH) difficult fork debacle in November 2022, which may have been 1 of the reasons for the unexpected drib to $3K.

BTC USD weekly chart. Source: TradingView

BTC USD weekly chart. Source: TradingView

As shown by the volume profile visible range (VPVR) on the weekly timeframe, Bitcoin has support to about $6,300 and then below $6,200 the price could swiftly drop to $five,350 where back up was congenital on Bitcoin's parabolic move from $3,120 in Feb.

BTC USD weekly RSI chart. Source: TradingView

BTC USD weekly RSI chart. Source: TradingView

The RSI on the weekly timeframe is at 39.6 and slowly creeping toward oversold territory. The terminal time the weekly RSI was oversold was on December. x when the cost was $3,160 and January. 21 at $3,425.

Double bottom or nix?

While the analysis is not calling for a drop to $5,300 or $4,100, Bitcoin's price action on multiple time frames suggests further downside so it'south crucial to be realistic and honest, rather than driven by emotion and hope.

On the bright side, there'south ever the possibility that the cost could form a double lesser at $six,520, a point that was seen on Nov. 25 and May 17, 2022.

Ultimately, Bitcoin price needs to hold the pink highlighted zone between $6,700 and $6,300 to avoid a drop back toward the May through April lows in the $4,900 to $v,500 region.

In the meantime, traders should keep an eye out for a possible double bottom around $vi,530 and given that the daily and weekly RSI and Stoch are oversold, aggressive traders might look to play an oversold bounce, which seems ripe to take place every bit Bitcoin comes closer to falling below the long-term descending channel support at $half-dozen,400.

Cautious traders can discover to see how traders and toll react to this oversold bounce (if it fifty-fifty happens), and they can also sentry to run across if the daily RSI becomes deeply oversold to form a double bottom at 22.

A relatively risk-free merchandise might involve playing a bounce at $half-dozen,500 to $half-dozen,400 with a cease loss placed closely beneath the entry. If this tactic proves fruitless, then the next option might be setting upwards a depression leveraged long at $5,300 or at least looking to play a deeply oversold bounce at this price.

The views and opinions expressed here are solely those of the author (@HorusHughes) and do not necessarily reflect the views of Cointelegraph. Every investment and trading motion involves risk. You should acquit your own research when making a conclusion.