Bitcoin Price Technical Analysis for 09/09/2016

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Bitcoin Price Key Highlights

• Bitcoin price recently made an upside break from its bullish continuation pattern, signaling that buyers are ready for more gains.
• Price seems to be pulling back to the broken short-term resistance before regaining momentum.
• There are plenty of support levels located nearby and these might be enough to keep the uptrend intact.

Bitcoin price is pulling back from its recent breakout but the nearby inflection points could hold as support.

Technical Indicators Signals

The 100 SMA is above the longer-term 200 SMA so the path of least resistance is to the upside and the climb could carry on. In addition, a rising trend line can be drawn to connect the lows of bitcoin price action since early this month and it appears to be holding as support so far.

A larger correction from the climb could find a floor at the broken flag resistance around $615, which is close to the 100 SMA dynamic support. Note that bitcoin price has been making bullish breakouts so far but it is stalling at a longer-term area of interest at the moment.

Stochastic is heading south for now so bitcoin price might follow suit. This could take it all the way down to the 200 SMA dynamic support, which might be the line in the sand for this uptrend.

Market Events

Risk appetite across the financial markets weakened when the ECB refrained from adding monetary stimulus in its rate decision. This led to broad-based gains for the safe-haven US dollar as investors predicted that global demand could weaken in the coming months without any support from the euro zone’s central bank.

Medium-tier data from the US economy also beat expectations, keeping dollar demand supported against bitcoin for the time being. However, continued weakness in US data could cause these dollar longs to unwind in favor of higher returns from holding the cryptocurrency.

For now, a bit of consolidation could be possible leading into the weekend as traders reassess their biases and risk preferences.

Charts from SimpleFX