Bitcoin Price Technical Analysis – Ready to Break Past $600?

Bitcoin Price Key Highlights

  • Bitcoin price staged such a strong rally on Friday that it’s ready to attempt a break past the latest highs at $600.
  • If this area holds as resistance, bitcoin price could retreat towards support at $550.
  • On the other hand, a move past $600 could put it on track to test the record highs at $1,200.

Bitcoin price is gearing up for a strong break of the $600 level, determining if longer-term gains are in the cards.

Technical Indicators Signals

The 100 SMA is still above the 200 SMA somewhat after nearly making a downward crossover late last week. This signals that buyers are putting up a strong fight and are willing to push bitcoin price much higher.

A bit of a consolidation can be seen at this point but it looks like buying pressure is in play. In that case, a long green candle closing above $600 could lead to a rally to the next major resistance around $700. On the other hand, reversal candlesticks around $600 could inspire profit-taking once more.

Near-term support is located at the moving averages near $560 and a bounce off this area could create a short-term ascending triangle formation. Stochastic is on the move up, confirming that buyers are in control of price action. RSI is also heading north so bitcoin price could follow suit.

Bitcoin Price Technical Analysis for 06/06/2016 - Ready to Break Past $600?

Bitcoin Price Technical Analysis for 06/06/2016 - Ready to Break Past $600?

Market Events

The US economy printed a downbeat NFP report lats Friday, triggering a sharp decline for the dollar against bitcoin price. Employment rose by a meager 38K versus expectations of a 159K increase while the previous reading was downgraded from 160K to just 123K. The unemployment rate fell to 4.7% but this was just a result of weaker labor force participation.

With that, dollar demand is significantly weaker, thereby driving up demand for bitcoin and other alternative currencies. Investors no longer expect the Fed to hike interest rates in June or even July, which might mean a couple of months’ worth of declines for the US dollar from here.

Keep in mind, though, that Fed Chairperson Yellen has a testimony lined up today and her remarks might still affect dollar and bitcoin price action.

Charts from SimpleFX

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