After lately looking like it might give way and make a second large leg down, Bitcoin (BTC) has nevertheless been holding pretty strong in the last day or two. And there are some signs that maybe enough strength is coming in to stave off that second drop. This is occurring as Bitcoin dominance is generally fading, and some notable altcoins are seeing some serious pumps.
We start with the 4-hour to get a detailed view. The general range is between $8,400-7,800, and Bitcoin is pointing up within this zone after a bounce off the bottom yesterday. Bulls have been dedicated in their defense of $8,000, and decent volume came in yesterday to keep it out of the danger zone.
BTC is currently ranging between the 55 and 21 exponential moving averages (EMAs), after yesterday retaking the 21. We can also note that the histogram is not arching down, but rather running flat mostly in a plateau configuration. This is a promising profile, and we could see another attempt for the 55 in a day or so.
On the daily chart (below), we are seeing a pretty good picture as well. Bitcoin is currently getting rejected at the 9 EMA and has been unable to retake it, but it will with just another small push. A bullish divergence has shown up on the RSI, while the histogram has crossed positive. However, it is hard to say what is going on with the histogram, with a very abrupt direction change two days ago when bulls saved the zone.
Finally, coming to the 12-hour, we see a more mixed picture. This is mostly because of a potential hidden bear divergence, which would suggest that the vaguely downtrending direction will continue. But being preceded by a clear bull divergence, we can probably reject this reading.
The histogram here is heading up at a flat rate, about to clear the previous high. This is an important candle for this chart, because the third candle in the row of this flat trajectory could stay where it is; or it could come down and add to the downward arc that was started on the 7th.
It really looks like Bitcoin has a fighting chance to stay at this level. However, it has to contend with the general look of a downtrend that was established after the September breakdown — a downtrend which seems like it needs at least one more leg down before finding bottom (especially according to “Elliott Wave” analysts).
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