Bitcoin Looks Solid After Breakout and Retest - Price Analysis

  • Short term: likely strength up to $11,000
  • Long term: long term uptrend is very strong at these levels

Bitcoin (BTC) put in work yesterday, breaking away from local lows near $10,000. The crypto has been uptrending well, although sell pressure has started coming in as the top of the range approaches. A general consolidation pattern between $11,000-10,000 seems to obtain, for now.

Looking first at the 2-hour chart, which just closed at time of writing, we can see that the breakout area above $10,500 is being retested. Some selling has come in, but the downside is so far quite limited. The 55 exponential moving average (EMA) here is being respected, after flipping to support on the breakout.

Maybe a small hickup?BTC chart by TradingView

Somewhat worryingly, though, the RSI uptrend here has been breached, and the MACD has crossed down. But a MACD cross here, so deep in positive territory, has a good chance of reversing back up quickly. Volume on the sell side has also been paltry, giving us a healthy expectation that upside will continue until the top of the consolidation pattern - at about $11,000.

Turning to the 4-hour, things look more stable. Volume has clearly broken out along with yesterday’s price breakout. The 21 EMA does the lifting here, and the breakout uptrend looks to be holding well.

4-hour chart looks greatBTC chart by TradingView

RSI on this chart still looks safe, with some elbow room remaining for a bit more downside if it’s needed. Ditto on the MACD: a bit of room remains for a bounce off the signal line, safely in positive territory.

Taking the daily view, we can see that yesterday’s pump shot right through the critical $10,600 mark, which has been a critical inflection point in the present market structure. A daily close above this level, today, would likely solidify the last leg of the uptrend to the top of the pattern.

Looking for a close above $10.6kBTC chart by TradingView

The RSI picture is tantalizing, because retaking - and holding - the 50 level would be a major milestone for Bitcoin and likely return it to a full uptrend. This might not happen right away. The MACD is, for today, showing a weaker uptick versus yesterday; but more than 12 hours remain before the close.

The full picture is one of health. On balance, a bit more upside up to at least $11,000 is likely. After that, we can consider the likelihood of a breakout, or alternatively of a longer consolidation above $10,000. Both of these possibilities are very positive for Bitcoin in the long term.

The views and opinions expressed here do not reflect those of CryptoGlobe.com and do not constitute financial advice. Always do your own research.