Bitcoin Price Analysis: Can Bulls Take BTC/USD Past This Near-Term Roadblock?
Bitcoin has formed higher lows and higher highs on its 1-hour time frame, moving inside an ascending channel pattern. Price already bounced off the bottom a few days back but has yet to show enough momentum to break past the near-term roadblock.
Price is currently testing the mid-channel area of interest close to $8400 and a break higher could take it up to the top around $8600-8700. The 100 SMA is above the longer-term 200 SMA to signal that the path of least resistance is to the upside or that the uptrend is more likely to continue than to reverse.
However, the gap between the moving averages is narrowing to signal weakening bullish momentum. Still, the 100 SMA is close to the channel support to add to its strength as a floor in the event of another dip. The 200 SMA is also just below this potential floor around $8000 and might be the line in the sand for a pullback.
Stochastic is starting to head lower from the overbought region to reflect a return in selling pressure. RSI still seems to have some room to climb but is nearing overbought levels as well. This signals that buyers are feeling exhausted and may book profits or let sellers take over from here.
Bitcoin has gained some traction after the April 17 tax deadline but investors are worried that the rallies are not as strong as expected. There have been positive industry developments, though, such as acquisitions by Coinbase and the IMF’s push for an even-handed approach to bitcoin regulation.
The dollar has been putting up quite a good fight as its scored consecutive gains on the heels of surging US bond yields. Economic data has been mostly upbeat and supportive of further tightening, and Fed commentary has been hawkish as well.
Traders are likely waiting for more bullish clues before piling on long positions, but there could be profit-taking activity leading up to the weekend.