Bitcoin Price Key Highlights
- Bitcoin price continues to crawl higher and is making its way above the area of interest to aim for the channel resistance.
- However, technical indicators are signaling that the rally could slow down.
- If so, bitcoin price could make another dip to the channel support before gaining stronger bullish momentum.
Bitcoin price is breaking past the nearby resistance around the middle of the channel, opening the path to a climb to the $5200 area.
Technical Indicators Signals
The 100 SMA is above the longer-term 200 SMA so the path of least resistance is to the upside. This means that the uptrend is more likely to continue than to reverse. Price has also moved back above the 100 SMA dynamic support to reflect the return of bulls.
However, the gap between the moving averages is narrowing to indicate weakening bullish pressure. Stochastic is also indicating overbought conditions so profit-taking might happen and lead to a dip back to support at $4400 or until the 200 SMA dynamic inflection point at the $4000 major psychological support.
RSI is still on the move up and has enough room before hitting overbought levels. This signals that buyers could prop bitcoin price up for much longer, possibly taking it to new highs at the top of the channel or at least a test of the all-time highs near $5000.
Market Factors
Geopolitical risks seem to be fading as financial headlines haven’t mentioned much on North Korea tensions and are instead focusing on the debt limit extension for the U.S. government, which basically avoids a shutdown happening anytime soon.
Although this has led to a bit of support for the dollar against bitcoin price, dovish Fed rhetoric could still stay in play as the Beige Book reflected subdued gains in wages even as labor market conditions remain tight. This could keep expectations for another Fed rate hike in check, but a lot could still hinge on the actual FOMC statement later this month.
As for bitcoin itself, the market seems to have shrugged off the impact of China’s ICO funding ban as investor interest in the cryptocurrency remains strong after the recent activation of SegWit.