Analysis- Bitcoin Rebounds After Meeting Strong Support; Will This Bullish Rally Push the Market out of the Triangle Formation?

Analysis- Bitcoin Rebounds After Meeting Strong Support; Will This Bullish Rally Push the Market out of the Triangle Formation?

Bitcoin has seen a well sought after 3% price increase over the past 24 hours of trading. The cryptocurrency giant is currently exchanging hands a round a price of $6506 (at the time of writing) bringing the 30 day price increase to over 7.26%.

A lot has developed since our last Bitcoin technical analysis post, however, the long term descending wedge formation that we have been following is still heavily in play as the market retests the upper boundary of the triangle before being rejected.

Morgan Stanley has recently come out today saying that they will soon be opening a market that will allow institutional investors to trade a derivative of Bitcoin. This is likely to be the main fundamental driving force behind the price rally today.

Bitcoin still currently holds the number one position in terms of overall market cap across the entire industry with a total market cap value of $112 billion. The 65 month old coin is currently down 66% from its all time high price.

Let us continue to analyse price action over the medium term and update any expected support and resistance levels.

Price Analysis

SponsoredBitplay

BTC/USD – MEDIUM TERM – DAILY CHART

https://www.tradingview.com/x/bnzFXlU9/

Analysing price action from the medium perspective above we can see that the market is still trading within the confines of the triangle formation. In our last analysis, price action had just popped up above the triangle but failed to hold as the resistance proved to be too strong.

We can see that price action then dropped throughout the August 2018 bloodbath, until the market had found support at a short term .886 Fibonacci Retracement level priced at $6129. This Fibonacci Retracement is measured from the bullish run that started toward the end of June 2018 and finished at the end of July 2018.

We can see that the support located at $6129 proved to be significant as the market rebounded from this support level to rally back into resistance created from the upper boundary of the triangle in early September.

Price action rolled over and reveres, aggressively, once again after meeting the resistance at the upper boundary of the triangle. It continued to fall until hitting the established support level at the short term .886 Fibonacci Retracement level priced at $6129, where the market rebounded.

Price action has now broken back up above the resistance level located at the short term .786 Fibonacci Retracement level priced at $6398 to a level where it is currently trading at $6494.

If the bullish momentum continues within the market, we expect immediate significant resistance to be located at the long term .786 Fibonacci Retracement level priced at $6622. Further resistance above this level can then be expected at the short term .618 Fibonacci Retracement priced at $6848.

If the market can continue further higher, we expect more resistance to be located at the 100 day moving average which is currently hovering around the $7000 handle followed by the upper boundary of the triangle formation.

Alternatively, if the bears step back into the market to push price action lower, we can expect immediate support to be located at the short term .886 Fibonacci Retracement level priced at $6129. Support expected below this level can be located at the psychological round number handle of $6000 followed by the lower boundary of the triangle formation.

The technical indicators within the market are currently producing neutral readings. The RSI is currently trading at the 50 handle after rising up out of oversold conditions. This indicates that the recent bearish momentum has faded and if the RSI can break back above the 50 handle we could expect some positive price action for Bitcoin.

What's Your Thought On This ?, Let Us Know In the Comment section Below.
♥Get Daily Crypto News On Facebook | Twitter | Telegram | Instagram