Bitcoin Price Key Highlights
- Following the recent upside breakout from the symmetrical triangle pattern, bitcoin price continued to climb as predicted in the earlier post.
- Price has now made its way to the triangle highs around $780 and is showing increased buying pressure to form new highs.
- Technical indicators are giving mixed signals at the moment, but it looks like the odds are in favor of more bullish action.
Bitcoin price followed through with its consolidation breakout and sustained its climb.
Technical Indicators Signals
The 100 SMA is above the 200 SMA so the path of least resistance is to the upside. The gap has been pretty steady so bullish momentum could stay in play until a downward crossover takes place. Also, the 100 SMA lines up with the triangle support so any pullback from the climb could bounce off this area around $750.
Stochastic is already indicating overbought conditions, which suggests that buyers may be feeling exhausted from the climb. RSI is still moving up so there may be some bullish pressure left, possibly until a test of the $800 handle, before profit-taking happens and bitcoin price retreats.
Market Events
A weak US dollar and an influx of investments from China combined forces to boost bitcoin price up the charts recently. Note that the Chinese government has imposed capital controls to restrict offshore investments so traders from the mainland are getting creative with their ways to pursue higher returns and hedge against yuan-devaluation.
Bitcoin traders also appeared to shrug off reports that the IRS and US Justice Department can seek information on bitcoin holders, focusing instead on the launch of bitcoin funds in China. In particular, Huiyin Group has announced that it is investing $20 million in blockchain ventures to support developments in the industry.
To add to this, remarks from the Winklevoss twins on how bitcoin can be better than gold also added to the cryptocurrency’s appeal. Event risks for the day include the NFP report, but this might not cause much of a flurry since Fed rate hike expectations have been priced in for quite some time. Be mindful of profit-taking and additional volatility leading up to the weekend as usual.
Charts from SimpleFX