Bitcoin appears to be getting back on its feet as it forms a fresh rising trend line on its 1-hour chart. A quick pullback to the support area may be in order and a bounce could take it past the swing high at $6,530.
Applying the Fib retracement tool on the latest swing low and high shows that price may have already found support at the 38.2% Fib just above the trend line. However, price has yet to break past the swing high to confirm that bulls have the upper hand. With that, a deeper correction to the lower Fibs at $6,427 or $6,400 could still be possible.
The 100 SMA is above the longer-term 200 SMA on this time frame to confirm that the path of least resistance is to the upside. In other words, the uptrend is more likely to resume than to reverse. These indicators might hold as dynamic support levels also as they line up with the 50% and 61.8% Fibonacci retracement levels.
Stochastic is turning lower to signal that sellers are still in control and that it may take some time before oversold conditions are seen. RSI is moving sideways to reflect current consolidation action, barely giving any directional clues at the moment.
Cryptocurrencies appear to be off to a good start in November as optimism is returning. Traders are looking forward to ICE Bakkt bitcoin futures and the increased volumes and activity it could bring. Apart from that, traders might also be positioning for an influx of institutional investment as Fidelity is prepping its platform for bitcoin and ethereum.
Besides, it appears that risk appetite is making its way back to financial markets as geopolitical risks are easing. The US midterm elections is underway, though, so there may still be some jitters but optimism for a Brexit deal and hopes for a resolution to Italy’s budget woes are in play.