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Bitcoin (BTC) is still in correction mode, with the BTC price dropping below $ 17,600 on December 11, its lowest level since November.

Bitcoin in a downtrend on lower timeframes

Every nice rally comes to an end and is followed by a correction period. This correction seems to have started with the price falling by more than 10% since then ever touch a new record ten days ago.

Nowadays some recent news the proposed crypto regulation in the United States brings fear to the otherwise euphoric market. However, other markets have also suffered this week, with stocks cooling down as well.

BTC / USD 4-hour chart. Source: TradingView

The 4-hour chart implies a clear downward trend. Such a downward trend is confirmed by lower peaks and troughs, as shown in the chart.

First, the price of Bitcoin failed to break through its all-time highest region, after which $ 18,500-18,700 formed a strong support area for a week.

Any bounce from this area (as the arrows show) marked a weaker bounce, as lower highs were constantly forming. After three tests, the support failed and the price of Bitcoin dropped to the next support level between $ 17,600-17,800.

This support zone delivered a slight rebound to $ 18,500-18,700. To turn bullish, this zone had to flip for support, which it failed. This rejection confirmed the bearish reversal of support / resistance, after which the downtrend resumed.

In general, the downtrend will always show lower highs and lower lows until a clear bottom is found. However, it doesn’t seem like the market will discover it anytime soon as higher timeframes are eager to move south too.

Bearish divergence on the daily time frame is confirmed

BTC / USD 1-day chart. Source: TradingView

The daily chart indicates a potential bearish divergence that is ready to be played out. This bearish divergence will be confirmed when the price of Bitcoin falls to break through $ 18,600-18,800.

In this sense, previous resistance becomes resistance again, confirming the overall weakness of the markets and that more downward effects are likely.