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Bitcoin Price Key Highlights
- Bitcoin’s price suffered a quick selloff last week, but the uptrend line on the 4-hour time frame held.
- This suggests that bulls might be able to stay in control for the remainder of the year, potentially taking Bitcoin back to its yearly highs.
Bitcoin prices could make it all the way up to the $500 level if bulls continue to keep pushing higher, although another sharp selloff might be possible.
Potential Support Zones
With the end of the year fast approaching, profit-taking activity could take place as traders want to close out with gains. For the bulls, this could mean exiting positions at psychological levels or areas of interest.
Price is still recovering from its trend line test at the moment, with the next potential resistance at the previous highs just below $480. The relative strength index is on the move up and so is the stochastic oscillator, which means that bullish momentum is currently present.
In addition, the 100 SMA is safely above the long-term 200 SMA, indicating that the path of least resistance is to the upside. In that case, any correction to the trend line support around $425-430 could be followed by another quick bounce.
The average directional index is moving lower, possibly reflecting a return to ranging market conditions. If so, the Bitcoin price could keep moving sideways as investors wait for more catalysts this week.
One major catalyst is the FOMC statement, during which Fed officials are expected to announce a rate hike. This is expected to spur strong dollar demand, although expectations have been priced in a long while back. With that, any cautious comments from the policymakers could actually be accompanied by dollar weakness, potentially leading to another leg higher for Bitcoin’s price.
Intraday support level – $425
Intraday resistance level – $480
Technical Indicators Settings:
- 100 SMA and 200 SMA
- Stochastic (14, 3, 3)
- RSI (9)
- ADX (14, 14)
Charts from Bitstamp, courtesy of TradingView
