/latest/2019/12/bitcoin-jumps-10-climbing-back-into-october-chart-price-analysis/
Bitcoin (BTC) is showing some strength today, after punching back through the border of October’s market structure at around $7,300. The leading crypto has been flirting with this level for a couple of weeks, ever since “capitulating” through it on November 19. Today’s surge was exactly 10% from bottom to top, and now we wait to see how the daily will close and digest the move.
Starting on the 4-hour, we can see the very specific area between $7,300-450 that Bitcoin keeps spilling over and under. This area is where support came in during October to effect a Bitcoin reversal – short term reversal, it proved – from its downtrend.
For bulls, this is a promising movement, which – if it sticks – will constitute a higher low versus the November 25 low put it (more on that later). Some good volume came in to support this movement, and we see that the histogram has been pushed aggressively into positive territory after diverging bullish from price.
Moving to the daily, we are reminded to curb our expectations on this move and bear in mind the larger downtrend. Bitcoin is now getting caught within a larger resistance, from about $7,400-800 (red band), which itself sits just above where most Bitcoin trading occurred during 2018 (colored bands).
Here, we are always looking for the end of the downtrend that has been in play since the summer. We see a large divergence from price forming on the RSI, although this doesn’t quite hold on the 2- and 3-day charts (not shown). We would probably want to see a more recent divergence on the daily, on a lower price low, to have more confidence.
But if Bitcoin can claim and close above the 21 EMA today (orange line), this move may begin to look like a larger reversal. At present, it is too early to say.
The views and opinions expressed here do not reflect those of CryptoGlobe.com and do not constitute financial advice. Always do your own research.
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