Bitcoin continues to trend higher as it broke through another near-term resistance level to test $4,300. This area is holding as resistance, so price might need to pull back before heading further north.
Still, the 100 SMA is above the longer-term 200 SMA to confirm that the path of least resistance is to the upside. This suggests that the uptrend is more likely to gain traction than to reverse. The 100 SMA dynamic support also lines up with the bottom of the channel to keep losses at bay.
This moving average also coincides with the 61.8% Fibonacci retracement level, which might be the line in the sand for a short-term correction. A shallow pullback could already find support at the 38.2% Fib at the mid-channel area of interest. If so, bitcoin could revisit the latest highs or even bust through the channel top for a steeper climb.
RSI is already turning lower, however, indicating that sellers are returning. Similarly stochastic is heading south so bitcoin could follow suit as bearish pressure takes hold.
Positive developments are being highlighted these days as the sentiment shifts to a more optimistic one. There have been reports of funding rounds and companies being able to secure more investments from institutions, signaling that there is still a lot of activity going on in the space.
Of course there is also increased coverage on bullish expectations as market analysts are pointing to more signs that bitcoin has bottomed and could be due for a big rebound. For Binance co-founder CZ:
“Short rallies are exactly what happens before a real rally ensues. This could set up a more sustained ‘Buy the Dip’ market as we look to the upcoming institutional launches to give this legs.”
Reports that two US lawmakers have filed legislation that excludes digital assets from being treated as securities also added to the pickup in sentiment. This bill would also clarify taxation issues on cryptocurrencies and seek to maintain regulation without curtailing trading and investment activity.