Bitcoin (BTC) Price Analysis: Bulls Test Triangle Top Again!
Bitcoin has formed lower highs and higher lows to create a symmetrical triangle pattern on its 4-hour time frame. Price recently tested support and has bounced back up to the triangle top, perhaps to attempt another break higher.
The 100 SMA is above the longer-term 200 SMA to confirm that the path of least resistance is to the upside. In other words, resistance is more likely to break than to hold. If that happens, bitcoin could climb by the same height as the triangle formation, which spans $3,200 to $4,400.
However, RSI is already indicating overbought conditions or that buyers are feeling exhausted. Turning lower could signal a return in bearish pressure as sellers regain control, possibly taking bitcoin back down to the triangle bottom. A break below this could spur a drop of the same size as the triangle, although the 200 SMA close by could add support at $3,800.
Stochastic is pointing up to signal that there is some bullish pressure left but the oscillator is also nearing the overbought region to indicate that buyers might feel exhausted soon.
Bitcoin was off to a positive start this year and seems to be making a strong attempt at pulling up from the earlier slide. Optimism for a big rebound in the next few years might still be driving the rallies, but it’s encouraging to see bulls being able to defend nearby support levels quite well.
It could take an actual industry development more than just simply expectations to sustain a climb, but an upside break of a key technical level could encourage even more bulls to charge. In fact, analysts predict that if bitcoin is able to keep its head above the $4,000 major psychological mark for the rest of the day, it might be enough to encourage more bullish positioning in the days ahead.