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Bitcoin Price Key Highlights
- Bitcoin price is still trading inside its short-term ascending channel and is currently testing the resistance.
- Reversal candlesticks have formed at this level so it’s likely that bulls could book profits and trigger another dip to the channel support.
- Technical indicators are showing that the uptrend could continue but that a pullback is due.
Bitcoin price could be in for a drop from the channel resistance, offering another chance to buy on the dips to support.
Technical Indicators Signals
The 100 SMA is above the longer-term 200 SMA so the path of least resistance is to the upside, which means that the bitcoin rally is likely to carry on. The 100 SMA is in line with the channel support at $735, which could keep losses in check in the event of a quick selloff. The gap between the moving averages is steady, indicating that bullish momentum is present.
Stochastic is in the overbought zone, which means that buyers are feeling exhausted at this point and could trigger profit-taking. If that happens, a small dip could take place, although the pullback might be shallow and a bounce might be seen before bitcoin price even hits support. If buyers are eager to hop in, bitcoin could even break past the channel resistance at $755 and set off a sharper climb.
Market Events
The FOMC kept interest rates on hold as expected, although one formerly hawkish member (Rosengren) did not urge for a rate hike this time around. The official statement was mixed, as it featured a more upbeat assessment of inflation but still contained some degree of caution.
In other dollar-related news, the fall in US stock markets owing to election uncertainties is also weighing on the currency and encouraging investors to move their higher-yielding holdings to bitcoin instead.
The next event risk for the US dollar this week is the NFP release, and leading indicators are giving mixed signals as well. The ADP non-farm employment change came short of expectations while the jobs component of the ISM manufacturing survey printed a strong gain. The ISM non-manufacturing survey is due today and a small decline in the index is eyed.
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