- Bitcoin re-enters the $8,000 range as focus shifts to $9,000.
- The high volatility and increasing buying activity present the perfect technical picture for more upward action.
Bitcoin once gains proved that it had indeed found a bottom in December by pushing the bullish action a notch higher. Recently, the correction above $7,000 came short of $8,000. Bitcoin consolidated the gains between $7,800 support and $8,000. However, the largest digital asset in the cryptocurrency industry wrote a different narrative on Tuesday by jumping above the coveted $8,000.
The bullish action was strong enough to break the resistance at $8,400 but left $8,500 untested. The reversal that ensued pushed Bitcoin against the tentative support at $8,300 and $8,200 respectively. However, the bulls came out strongly at $8,150 and put a stop to the declines. Meanwhile, Bitcoin is trading at $8,253 following a 1.38% growth on the day.
XBT/USD daily chart
It is important to note that Bitcoin price is teetering above the 50-day Moving Average. The strong support offered by this moving average could continue to influence the price, further boosting the approach towards $9,000. Similarly, the break past the falling wedge pattern resistance appears to be a contributing factor to the recent price action.
From another technical perspective, the Relative Strength Index suggests that the bulls are in control. Besides, a break into the overbought region above 70 would place BTC futures contract on a path to the psychological $9,000. However, Bitcoin must reclaim the lost ground above $8,400 and push for gains past $8,500 in the short term. On the flip side, support at $8,150 and $7,800 will remain intact in the event another reversal ensues.
Bitcoin Key Technical Levels
BitMEX index price: $8,301
24-hour volume: $4.3 billion
Open interest $739 million
Relative change: 156
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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