Bitcoin at risk, bearish divergence forms, hash rate falls

Bitcoin price remained in a tight range on Saturday as the hash rate dropped and a bearish divergence formed, creating the risk of a bearish breakout.

Bitcoin (BTC) was trading at $94,296 at last check as the market reacts to the Bureau of Labor Statistics’ latest report showing the US economy has created more than 256,000 jobs. The unemployment rate fell to 4.1 percent.

As a result, American stocks fell; Dow Jones and Nasdaq 100 indexes fell 697 and 317 points, respectively.

As Crypto.news expected, the bond market continued its sell-off and the 30-year yield rose to 5.0%. 10- and 5-year yields rose to 4.76% and 4.57%, respectively. Rising yields suggest the market expects the Federal Reserve to strike a hawkish tone, which often affects risky assets like Bitcoin and altcoins.

Source: CoinGecko

Meanwhile, IntoTheBlock’s data shows that Bitcoin’s hashrate has declined over the past few days as its price stalled.

On Saturday, January 11, the hash rate was at 750 TH/s; This was lower than the 30-day high of 911.88 TH/s and the 30-day average of 793 TH/s.

Hash rate is an important number that looks at the speed at which mathematical puzzles are solved on the network.

Bitcoin hash rate | Source: IntoTheBlock

Further on-chain data shows the number of active Bitcoin addresses dropped from 900,000 to 775,000 on Monday; This is a sign that some traders are starting to sell. For example, according to SoSoValue, there was a total outflow of $572 million from all spot Bitcoin ETFs in the last two days.

Bitcoin price shows a downward trend Bitcoin price chart | Source: crypto.news

The daily chart shows that Bitcoin is at risk of a downtrend. The neckline formed the risky head and shoulders chart formation at $90,952. This is one of the most popular bearish patterns in trading.

Bitcoin’s Relative Strength Index and MACD indicators have formed a bearish divergence pattern. The histograms of the MACD have moved below the zero line.

Therefore, a break of H&S below the 90.950 neckline poses further downside risk. The first support for this will be the 200-day moving average at $78,285, followed by last year’s March high at $73,985.

On the positive side, as we wrote earlier this week, Bitcoin price is forming a bullish pennant chart pattern on the weekly chart. This formation will remain in play as long as it is above $90,000.