Bitcoin Price Key Highlights
- Bitcoin price reached the yearly highs around $780 and profit-taking happened as predicted in the previous article.
- Price is now making a pullback from its recent rally and could encounter more bulls who are waiting at the next area of interest.
- Technical indicators are confirming that the uptrend could resume once the correction is completed.
Bitcoin price is retreating upon reaching its yearly highs but bulls could be ready for another push higher after this pullback.
Technical Indicators Signals
The 100 SMA just crossed above the longer-term 200 SMA to indicate that the path of least resistance is to the upside. The gap between the moving averages is widening, which means that bullish pressure is getting stronger and that bitcoin price could revisit its recent highs sooner or later.
Stochastic is turning higher from the oversold area, also to indicate that profit-taking might be over and that buyers could return to the game. RSI is also starting to bottom out so price could follow suit. However, a larger pullback to the broken resistance around $720-735 could encounter more bulls waiting with their long orders.
Market Events
Yellen’s hawkish speech in front of the Joint Economic Committee confirmed that a December Fed rate hike is in the bag. This led to strong gains for the US dollar across the board, although this sentiment may have long been priced in already so there might not be much more gains for the US currency.
With that, the pickup in risk sentiment could favor bitcoin price once more, as traders move closer to booking profits off their long USD positions towards the end of the year. In her testimony, Yellen cautioned that increased fiscal stimulus could run the risk of overheating the US economy, especially since it is already nearing full employment. Still, she added that the Fed stands ready to make adjustments if necessary.
Data from the US economy has been mostly stronger than expected and the remaining event risk might be the US NFP report. As for bitcoin, renewed interest from Chinese investors on a weakening yuan has been keeping the cryptocurrency supported.
Charts from SimpleFX