- Bitcoin settles in a range ahead of the weekend session.
- The resistance at $7,200 must come down for Bitcoin bulls to stay focused on higher levels close to $8,000.
Bitcoin has entered into a new consolidation phase between $7,000 and $7,200. The relatively sideways trading comes after BTC corrected from a recent high close to $7,487. The session in the last four days has been extremely volatile, whereby Bitcoin dived under $7,000. Initially, the support formed at $6,800 was strong enough to hold the losses. However, increasing selling activity saw Bitcoin pushed to the November lows around $6,500.
Consequently, a reflex action emanated from the formation of a double-bottom pattern, sending BTC in a majestic step towards $7,500. Meanwhile, the buyers have intentionally barricaded the support at $7,000, preferring ranging movement under $7,200.
XBT/USD 1-hour chart
The Relative Strength Index has retreated from the recent high around 85.27. The downward slope suggests that sellers are gradually gaining traction. However, stability is expected above the average level and likely to push Bitcoin above the stubborn resistance at $7,200.
Looking at the moving averages, the 50 Exponential Moving Average (EMA) in the hourly range has pushed above the longer-term EMA 100. The widening gap between the moving averages signals that bullish momentum is growing. The right volume, coupled with the improving technical picture, could place Bitcoin in a trajectory towards $8,000.
Bitcoin Key Technical Levels
BitMEX index price:
Trend: sideways trading
RSI: Stable above 50, signals sideways trading will last longer