Bitcoin has approached the resistance of the descending triangle after extending its mini relief rally. Bitcoin is trading at $285.63, up $1.72 or 0.60 percent.
This increase in price gives the short-sellers an extremely low-risk trading opportunity. However, the technical signals aren’t conveying anything decisively.
Take a look at the considerations drawn from the daily BTC-USD price chart below.
Bitcoin Chart Structure – Bitcoin is currently testing its downward sloping trendline. The distance between the resistance and the support continues to contract and hence, a high-volume breakout may be in the offing. If the cryptocurrency breaches the resistance and goes past the previous high of $297, then huge short-covering will be observed.
Fibonacci Retracements – Bitcoin should revisit $280 – the 38.2% Fibonacci retracement – if the bulls lose the grip now.
Moving Average Convergence Divergence – What’s confounding is that even as the price has risen, MACD hasn’t showed much strength in its reading; it is still subdued below the Signal Line. The latest MACD, Signal Line and Histogram values are 3.4487, 5.4192 and -1.9705 respectively.
Momentum – The Momentum indicator has, in fact, reported depreciation in its value; while yesterday it was -4.8700, today it is -7.5600.
Money Flow Index – The MFI has grown slightly to 65.5654 indicating positive sentiments.
Relative Strength Index – The RSI is still near-neutral at 55.2138.
There is a simple strategy that can be followed now. Short Bitcoin at current levels and place a tight stop-loss just above the resistance line. Cover the shorts when the price near the support level.
In case, the resistance is taken out, exit short positions and create light long positions for a target of $295 by placing a stop below $285.
Originally appeared at: http://www.newsbtc.com/2015/08/05/bitcoin-price-technical-analysis-for-582015-follow-this/