Bitcoin‘s (BTC) price has seen a $350 drop this morning from Tuesday’s two-month highs and may be headed for a short-term correction, technical charts suggest.
As of writing, the leading cryptocurrency is trading at $8,220 on Bitfinex down 3.5 percent from the high of $8,507 reached yesterday.
Today’s dip is not surprising and could be extended further as BTC’s 40 percent rally from the seven-month low of $5,755 reached on June 24 is still looking overstretched, as per the relative strength index (RSI).
The short duration charts have also aligned in favor of a deeper correction.
However, the bullish reversal has likely revved up investor interest and bargain hunters who missed out on lower prices prior to the rally could step in prevent significant losses.
The 50-hour, 100-hour, and 200-hour moving averages (MAs) are trending north and are located one above the other, indicating the path of least resistance is to the upside. Consequently, these MAs could be the area of interest of the bargain hunter.
As of writing, the 50-hour MA is located at $8,023.
Meanwhile, the 100-hour MA, currently located at $7,736, almost coincides with the rising trendline, thus dip demand could be strong around that level…