After a pretty uneventful weekend, relative to history, Bitcoin (BTC) has nevertheless survived an important period as the bulls fought to stay above $10,000 and won. The leading crypto is breaching key levels at time of writing, and a new consolidation pattern with a top at $11,200 is likely.
Starting on the daily chart, we see that price has trended up since August 15, and has just breached the key centerline of the local market structure at $10,600. Bitcoin has been unable to close above the 55-day exponential moving average (EMA, purple), but a close above it today is looking pretty likely.
The volume profile will signal the next leg up, if it comes. It has been flagging for some days now, after the climaxing during the dump down to $9,500.
And if we look at the 4-hour chart for a granular view, we see that a volume breakout has already come (Bitstamp exchange). The latest pump – coming just minutes ago – has propelled BTC above $10,600, and volume has broken out along with it.
The 55 EMA has also been breached, and we are likely to see a leg up to $11,200 from here, where BTC will bump into downtrend and horizontal resistances. $11.2k should now be a key level, and the locus of a decision point: Bitcoin could break out there and resume a full medium term uptrend, or be rejected and sent back down into a medium term consolidation pattern.
Even closer, on the 1-hour, we see a clear break up out of an ascending triangle pattern. Bitcoin faked down from this pattern on August 17, but the drop didn’t stick.
Although Bitcoin is likely to continue chewing through this range on its next leg up, there is of course the possibility of another fake down. This seems unlikely, however, as volume on this breakout has been much higher (Huobi exchange) than volume on the fake down.
A good daily close above $10.6 would confirm this movement. Things are looking good for Bitcoin today.
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