Bitcoin (BTC) has blasted through a key area of resistance in the local market structure, seemingly waylaying any possibility of a retrace or correction toward the lows. Retaking key levels may foster enough confidence for the market to stop waiting for a retrace, after the astonishing and nearly unbroken uptrend since February.
We can see below, on the daily chart, the broad strokes of what has happened. A very dense knot of support/resistance (S/R) around the $8,300 zone has been broken. Not only that, it was broken yesterday with a powerful candle to the upside, which closed well above the area in question.
Upward momentum seems to have returned for the leading crypto. A larger retest of yesterday’s breakout zone would solidify upward sentiment.
If we take a granular look on the hourly chart, we see the geography of yesterday’s breakout out of an uptrending channel (or a rising wedge). Strength has held up well: we see even on the small hourly timeframe rising strength on the peaks. This is an extremely encouraging sign.
$8,500 looks like a great place for a retest of the breakout zone, being the intersection of the uptrend line, and the breakout line. However, owing to the look of the present formation, which looks like a bull flag, we should consider that no correction will come.
Glancing at the larger weekly picture, we can see that, Bitcoin easily has a shot to close the week at $8,800. This close would constitute a bullish engulfing candle - meaning it has matched the price of the opening of the previous bearish week, reclaiming all those losses. A close with more volume would add to the bullishness. A failure to complete this engulfing close might make us think twice about the counter-rally on our hands.
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