Bitcoin Bears Still in Charge But Indecision Could Open Doors for Rally

While the odds are still stacked in favor of bitcoin's bears, a level of indecision looks to be creeping in, according to the technical charts.

Amid the continued drop in prices the charts show a doji candle formed yesterday, indicating that the bears may be running out of steam and a short-term rally could be on the cards.

The pennant breakdown, a bearish continuation pattern, on the 4-hour chart indicates the sell-off from the last Monday's high of $8,644 has resumed and opened the doors to $6,800.

On the daily chart, the 5-day and 10-day MAs are trending south, indicating a short-term bearish setup.

A series of lower highs and lower lows also indicates the bears are in control.

The relative strength index is holding slightly above 30.00, signaling just enough room for another $200 drop in BTC prices.

The relative strength index has also rolled over in favor of the bears, while the 5-week MA is set to cross the 10-week MA from above, signaling a bearish crossover.

Clearly, BTC is on the defensive, still, there is merit in being cautious as the cryptocurrency created a small doji candle on Sunday at the key 76.4 percent Fibonacci retracement level of $7,209, indicating bear indecision in the marketplace.

An unexpected close today above $7,425 would confirm a short-term bullish doji reversal and allow a minor corrective rally, possibly to $7,800-$8,000.

Only a convincing move above the weekly 50-MA would abort the bearish view.