At time of writing, Bitcoin (BTC) has broken out of two resistance lines at about $8,400, and the market holds its breath waiting to see if the breakout has legs.
We can see the breakout point, below on the hour chart, out of a diagonal uptrend resistance. Notably, the formation Bitcoin had been trending in looked more like a rising wedge than anything - normally a bearish pattern presaging a breakdown.
One piece of evidence in refutation of that pattern interpretation, however, is the rising volume which attended this movement: typically, volume drops off toward the end of the pattern, whereas here it was rising. This might also make us believe that the breakout is not a fakeout, but in fact will continue.
Looking at the four hour chart, we can see that a critical area of resistance has already been broken. Given that the indicators are all highly overbought at this point, we might expect a pullback here back below $8,400 - and this will be the critical period to watch.
If the breakout area holds on a retest, while also cooling off the indicators, we may be set up for further moves to the upside. A failure to hold would probably send the leading crypto back down to $7,600 or lower.
Looking at the daily chart, we notice that the exponential moving averages (EMA) are once again being left completely in the dust. Momentum seems to be rebuilding back to the upside and the top of the recent market structure. On the daily RSI, we see that the critical 55 level has been retaken; this level has marked the zone of the entire recent uptrend from February.
If BTC were to successfully retest the 55, it could actually start laying in another new uptrend. This is a lofty hope, however. Bitcoin never had the correction and retrace that many analysts were expecting - even demanding.
In short, Bitcoin is doing Bitcoin things again.
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