Bitcoin Price Key Highlights
- Bitcoin price has formed higher lows and found resistance at the $6,785 level to create an ascending triangle.
- Price is testing the pattern’s resistance, which lines up with the broken long-term support visible on the 4-hour chart.
- Technical indicators are suggesting that the ceiling could hold for now.
Bitcoin price is testing the top of its ascending triangle pattern, but technical indicators suggest resistance might hold.
Technical Indicators Signals
The 100 SMA is still below the longer-term 200 SMA to indicate that the path of least resistance is to the downside. This means that the selloff is more likely to resume than to reverse or that resistance is more likely to hold than to break. With that, bitcoin price might need to revisit the triangle support before attempting another break.
Then again, it’s worth noting that bitcoin price is already trading above the moving averages, which reflects a pickup in bullish pressure. The gap between the moving averages is narrowing so selling pressure is slowing. A break past the triangle top could lead to a move of around $1,000 or the same height as the chart pattern.
RSI is turning lower to indicate a return in selling pressure, possibly enough to take bitcoin back down for a test of the short-term floor, which is also near the 100 SMA dynamic inflection point. Stochastic is also pointing back down without even hitting overbought conditions, which could also mean that bears are eager to return.
Market Factors
Bitcoin price has had quite a good run in the earlier week, which reflects a pickup in industry optimism. However, it could all hinge on whether or not the mood is sustained this week, likely by a set of positive updates or no negative headlines.
Meanwhile, the dollar could take its cue from the US CPI report and the usual set of trade war updates. A positive performance in stock markets, however, could also draw traders back to traditional markets and away from bitcoin.