Bitcoin (BTC) Price Analysis: Are Bulls Finally Returning?
Bitcoin is forming higher highs and higher lows to create a new ascending channel on the 1-hour chart. This follows an upside break from a longer-term descending trend line, suggesting that a reversal from the downtrend is underway.
Price is currently testing the mid-channel area of interest, which might still hold as a ceiling and send bitcoin back to the channel support around $7,500. A small bullish flag seems to have formed and a break higher could send bitcoin up to the resistance around $7,800-7,900.
The 100 SMA is above the longer-term 200 SMA to indicate that the path of least resistance is to the upside. This suggests that the rally is more likely to continue than to reverse. Also, bitcoin is above both moving averages so these could hold as dynamic support from here.
However, RSI is already indicating overbought conditions and turning lower. This suggests that sellers could still return and take price back down to nearby support zones. Similarly stochastic is in the overbought region to show that buyers are feeling exhausted and might let sellers take over.
Bitcoin has regained ground on risk-taking in the financial markets even as Ripple CEO Brad Garlinghouse continues to blast the cryptocurrency. He said that bitcoin is not the “panacea” to solve the problems that people thought it would, citing to CNBC:
“I think it’s (bitcoin) not going to be the panacea that people once thought it would be, where it would solve all of these different kind of problems… Instead, you’re seeing specializations of different kind of ledgers, different kinds of blockchains.”
He also said that bitcoin transactions are slow compared to Ripple, which is “a thousand times faster.”
Meanwhile, the dollar has been on weak footing for the most part of the trading day and failed to draw strong support from better than expected data.