Bitcoin Price Key Highlights
- Bitcoin price has formed lower highs and higher lows, creating a symmetrical triangle consolidation pattern on its 1-hour time frame.
- Price is approaching the peak of the pattern so a breakout could be due soon.
- Technical indicators are giving mixed signals at the moment, but fundamentals suggest that the path of least resistance is to the downside.
Bitcoin price is consolidating pretty tightly in a symmetrical triangle and a breakout in either direction could take place soon.
Technical Indicators Signals
The 100 SMA is below the longer-term 200 SMA on the 1-hour time frame so the path of least resistance is to the downside. In addition, the 100 SMA seems to be holding as a dynamic inflection point for the time being, although a move higher could still find a ceiling at the 200 SMA dynamic resistance at $1020.
The gap between the moving averages seems to be narrowing so an upside crossover might happen soon. However, stochastic looks ready to cross down even without having reached the overbought zone, which means that sellers are eager to get back in the game. RSI is cruising sideways, barely offering any strong directional clues at the moment.
Investors remain wary of potential bitcoin regulation from China, as authorities are still investigating money laundering activity, prompting top exchanges to halt client withdrawals temporarily. This has led to a flurry of profit-taking a few days back and traders are sitting on their hands for the time being to see how the crackdown pans out, keeping a lid on bitcoin price volatility.
Meanwhile, the US dollar gained ground against most of its rivals in anticipation of a March Fed rate hike. FOMC Chairperson Janet Yellen highlighted the progress in moving towards full employment and 2% inflation, citing that they shouldn’t wait too long to tighten – something that has been reinforced by comments from other policymakers. US data has also been upbeat and US assets could enjoy strong gains once Trump unveils his “phenomenal” tax plan in a week or two, putting additional downside pressure on BTCUSD.
Charts from SimpleFX