After repeatedly testing and staying close to the floor of $220-225, Bitcoin has decided to head higher. On its upward course, the cryptocurrency has pierced two important resistance levels discussed earlier in False Breakdown and is now trading at $233.33, up 1.29 percent.
There is another case that the market participants should be aware of: a new trading range. Even as Bitcoin climbs higher, I do not see it rushing its way up. Instead, I am expecting some consolidation if it reaches $245.
Take a look at the technical scenario by analyzing the daily BTC-USD price chart.
Bitcoin Chart Structure – Yesterday’s advance in price has helped Bitcoin to test its previous peak of $233. Currently, the cryptocurrency is trading above this level and may eventually head towards the resistance level of $245. The breached downward sloping resistance will now act as the support.
Fibonacci Retracements – While the 23.6% Fibonacci retracement of $226.32 has acted as a firm support, I am expecting the 38.2% Fibonacci retracement of $243.84 to also play its part.
Moving Average Convergence Divergence – The Histogram has moved into the positive territory as MACD amasses gains. This is another fresh positive.
Momentum – The Momentum has turned positive with the latest value coming in at 3.300.
Money Flow Index – The MFI value is now at 49.5824.
Relative Strength Index – The latest RSI value is surprisingly reflecting neutral bias with a value of 49.2144.
The new-found positivity will pose problems for the short-sellers in the near-term, and hence, short positions should be covered.
Market participants can consider building long positions now and on declines by placing tight stop-losses below the breached resistance line. The target on the upside is $245. Additionally, if this level is attained over the weekend, traders should liquidate all long positions and create light short positions.
Expect steady price action in Bitcoin over the weekend.