- The bullish breakout has enough legs which mean that traders can initiate long trades.
- Bitcoin must stay above $5,700 for a correction towards the new highs at $5,800.
Bitcoin has once again led the market into recovery after a week of declines followed by consolidation. Thursday, May second was indeed a great day for Bitcoin as it stayed in the bullish zone between $5,300 and $5,400. This support congestion culminated in Bitcoin sudden movement north today, May 3 where the largest crypto explored the levels above $5,700 and beat all odds to trade new 2019 highs around $5,800.
This bullish breakout has enough legs which mean that traders can initiate long trades. The price on the 4-hour chart is way above the trendline. As long as BTC/USD stays above this trendline, we could see more gains heading to $6,000 and beyond in the coming sessions this weekend. Looking back, Bitcoin bulls grip on the price sent Bitcoin to highs of $5,421 and closed the session at $5,367 supported by the 100 Simple Moving Average (SMA) 15-minutes. The extraordinary trend today has seen Bitcoin not only trade above the 50 SMA 15-minutes but also past the highs in April around $5,650 and extended the gains to brush shoulders with $5,800.
BTC/USD 15-minutes chart
Bitcoin is still bullish in a 4-hour timeframe. In fact, the price is holding above $5,750 in spite of the oversold levels reached. Moreover, it is still trading above the 200EMA which has supported the price since mid-February. Both the 50 SMA and the 100 SMA are playing catchup at press time in addition to offering support slightly above $5250.
On the other hand, technical indicators like the RSI are holding the position in the overbought at 88.00. The indicator is still trending upwards ignoring the oversold levels. Another indicator of the bullish trend is the MACD which currently points up at +139.92.
Prediction: Bitcoin must stay above $5,700 for a correction towards the new highs at $5,800. Staying too long in the range between $5,700 and $5,800 without a breakout to $6,000 over the weekend sessions; May 4 and May 5 could lead to buyers getting exhausted paving the way for a breakout to $5,500 and $5,400 respectively.
Bitcoin Key Technical Indicators
EMA200 4-hour: $5,06941
50 SMA 4-hour: 5,250.00
100 SMA: 5,314.57
Support areas: $5,500, $5,250 and $5,000.
Resistance: $5,800, $6,000
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John is a talented writer with over two years of experience actively contributing to the cryptocurrency industry by providing credible, interesting and easy to read the content. His main focus is on cryptocurrency price analysis and industry news coverage. Lets follow him on Twitter at @jjisige