In my previous Bitcoin technical analysis titled Gains Erased, I had mentioned that a trader should create long positions near $240 by maintaining a stop-loss below $238. Those who would have followed this advice would have made a neat profit of roughly $10 as the price rose to $250 after falling down to $240.
Due to this strong move, Bitcoin is trading up 0.80% at $248.40.
Taking a technical look at the 240-minute BTC/USD price chart above clearly reveals mixed technical indications, and that the game will turn in favor of the party which decides to the make the first strong move.
Bitcoin Chart Structure – The chart above tells that Bitcoin is consolidating between the important levels of $240 and $250. Post the Fed frenzy, the market seems to have returned to normalcy and the cryptocurrency has since then between oscillating in the $10 range.
Moving Average Convergence Divergence – The MACD has widened its split with the Signal Line, pushing the Histogram even lower. The latest MACD, Signal Line and Histogram values are 3.3993, 4.1831 and -0.7838 respectively.
Momentum – Another point of discomfort is the negative correlation between price rise and Momentum reading. The price has gained since yesterday, but the Momentum reading has crashed to dangerously low levels. The Momentum reading was a positive 6.0600 yesterday while today it is highly negative at 4.8600.
Relative Strength Index – RSI, on the other hand, presents a remarkably positive outlook. The underlying strength reading came in significantly strong at 60.3283.
I am expecting Bitcoin to spend some more time before a breakout happens, but it is extremely difficult to comment on the direction as of now. I would wait for more decisive indications before recommending a directional trade. But I think that one who makes the first powerful attempt will turn the odds in his favor. Expect a major price action as this week comes to a close.