Bitcoin found support at 216 this week and after a 3-point bullish divergence, it started to rally. The 1H chart shows the higher highs and higher lows made since the April 15th session. Note that price crossed above the 100-hour and 50-hour simple moving averages (SMAs). This reflects a loss of some bearish bias, but by no means is an indication of a bullish reversal. The 1H RSI tagged 70 which reflects initiation of some near-term bullish momentum.
Now, as bitcoin continues this week’s bullish correction, it will meet a key level around 232. This is key because it involves a previous support pivot and the 200-hour SMA. If price holds under 232, bitcoin is still bearish and the pressure should remain towards the 216 low. However, we will have to monitor price action at 224 if btcusd does indeed start falling. If price holds above 224 and the 1H RSI holds above 40, we might have more bullish correction throughout the weekend into next week.
If price falls back below 224, then we would have stronger evidence of bearish continuation. Below 216, we might see price stick around 200 for a bit. Below that, the 166 low on the year will be in play.
The 4H chart shows that if price breaks above 232, the next key level will be around 240, a previous support/resistance pivot. Above that, the next, we see resistance factors at 250, 255 and 262. A market that is still bearish should not make it back to 262. For now, we should limit the maximum bullish outlook to 250, but continue to monitor for resistance at 232 and 240 as well.
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