Bitcoin's current price is $36,802 (Siegfried Layda/Getty Images)

Bitcoin continues to trend lower, with no signs of a near-term reversal, despite a sideways consolidation this week. Major cryptocurrency assets continue to follow the global safe-haven markets, while rising interest rates favor U.S. fixed income assets.

The On Balance Volume indicator, developed by Joseph Granville in 1963, is very traditional in technical analysis and uses volume information to check for rallies or distributions. The indicator achieves a balance of volume between lows and highs, which may indicate that investors are recovering, as volume is a form of "fuel" for prices.

In the displayed K chart, the trend is still down, but the indicator (blue line) indicates that the recent trend has seen an increase in holdings and the volume balance is similar to the $43,000 level. We will continue to monitor this indicator in the coming weeks.

Source: (Lucas Costa/Disclosure)

The daily chart shows a 76.4% correction in price from the bullish move between July 20 and October 20, 2021. We can define support areas (of which the current price range is one) based on Fibonacci ratios, forming a horizontal price defense that we can have.

Another technical element we can observe is the formation of a downtrend line (connecting the recent highs), where we only have a buy signal after a breakout.

The strategic scenario still does not indicate a purchase, as it would be better to follow the current trend and still fall in the short term. We have highlighted the performance of the 21-week moving average, which has a downward slope and shows the continuity of the downward movement.

A buy scenario can occur after a breakout of a downtrend line (red), which marks the beginning of an upward reversal. More conservative investors can expect a higher bottom to form after a breakout of the above line for a better risk-reward ratio. It is important to be patient and cautious at this point, as they are virtues that yield great rewards in the market.

Source: (Lucas Costa/Disclosure)

*Lucas Costa holds a Master's degree in Administration and Economics from the Federal University of Juiz de Fora and has worked as an academic researcher and professor on the topics of blockchain, cryptocurrencies and consumer behavior and is one of the founders of the Blockchain UFJF research group. He is a Forex trader on a proprietary trading desk focused on technical analysis, and a personal trader in the futures market. He is currently a CNPI technical analyst at BTG Pactual digital and presents one of the most followed live analysis rooms in Brazil.

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