technical analysis bitcoin

Bitcoin (BTC) Price Watch: Testing Uptrend Channel Support

Avatar newsbtc 1 year ago

Bitcoin Price Key Highlights

  • Bitcoin price sold off after the SEC rejection of ETF applications but is finding support at the channel.
  • Price is still trading inside an ascending channel and is currently testing the very bottom.
  • A bounce could take it up to the next upside targets marked by the Fibonacci extension tool.

Bitcoin price is pulling back after its recent surge and is deciding whether to make a bounce or a break from the channel support.

Technical Indicators Signals

The 100 SMA is still above the longer-term 200 SMA to show that the path of least resistance is to the upside. This suggests that support is more likely to hold than to break or that the uptrend is more likely to resume than to reverse.

The area of interest around the broken $6,500 resistance is also in line with the channel support and dynamic inflection points at the moving averages. If the floor holds, bitcoin price could climb to the 38.2% Fib extension first near the mid-channel area of interest at $6,600.

Stronger bullish pressure could take it up to the 50% extension of $6,657.90 or the 61.8% extension at $6,738.30. The top of the channel lines up with the 78.6% extension of $6,852.80 The full extension is located close to the $7,000 major psychological resistance.

RSI has reached oversold territory to reflect exhaustion among sellers and is just making its way up to signal a return in buying pressure. Stochastic has had a bit more headway but has plenty of room to climb before hitting overbought levels, so there’s space for the rally to happen. A break below support, however, could allow a downtrend to take place.

The SEC rejected the bitcoin ETF applications filed by ProShares and a couple of other companies, leading investors to worry that the next batch probably won’t be approved as well. This puts the industry a step back in terms of getting more support from regulators and seeing securities based on digital assets for now.

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