Analysis: Will Bitcoin Break the $7,000 Resistance?

BTCUSD is breaking out of its triangle consolidation pattern but might still be facing some bearish pressure. Will Bitcoin break the $7,000 resistance level?

28 September 2018- Bitcoin price on Friday has seen trading with modest gains of 2.62%, as price action is yet to establish committed conversation in the trend. The price chart shows that Bitcoin price has moved by $163 (+2.52%), with a total volume of over $ 489 Million in last 1 Day, where the highest price of $ 6,806 was on 28 September 2018.

Forecast: Will Bitcoin Rally towards $7,000 mark?

Bitcoin price recently formed lower highs and higher lows to consolidate in a symmetrical triangle. The price appears to have completed an upside breakout, signaling that more gains are underway. Technical indicators, however, are reflecting a slowdown in bullish momentum.

The 100 SMA line is still below the longer-term 200 SMA line to signal the path of least resistance is to the downside. In other words, there’s still a chance for bearish momentum to return and prove the break higher was a fake out.

Bitcoin price is trading above the 200 SMA dynamic inflection point which reflects stronger bullish pressure. This could spur a bullish crossover, especially since it seems the MA are just oscillating. In that case, the price might hike as the chart formation, which ranges from $6,000 to around $8,400 levels.

Yesterday, Bitcoin completed a Three Inside Up candlestick pattern which indicates the Bullish reversal. The above-mentioned pattern is a more reliable addition to the standard Harami pattern. A bullish Harami pattern occurs in the first two candles followed by the third candle which is a white candle with a higher close than the second candle. Thus, the pattern is a confirmation of the bullish trend reversal.

According to Fibonacci retracement charts, Bitcoin is trading above the 61.8% Fibo. Retr. zone and a break above the 78.6% fibo. Retr. i.e might encourage more buyers. In addition, RSI(14) for Bitcoin is to the neural side and ATR(14) signals the coin volatility remains low, hence trading the pair became safe for the traders to occupy this position till the price goes bullish towards the $7000 levels. Thus, a bullish rally towards $7000- $7200 might be expected in the upcoming days. 

Sentiment in the crypto-market seems to be turning bullish again, following a couple of positive industry updates. Google will be overturning its ban on Bitcoin and ICOs ads by next month, likely reviving interest from the traders. However, the search engine will narrowly approve Google ads from regulated entities targeting audiences in the US and Japan only.

  • The Relative Strength Index(14) value is near 50 which signals “Neutral”
  • The William%R signals the buying price action on daily time-frame.
  • MACD(12,26) – “Buy” signal in daily charts.
  • ATR(14) suggests Bitcoin is less volatile.

Bitcoin Pivot Points