Bitcoin (BTC) has been consolidating for about a week, after its dramatic reversal from the low $7k region. Its formation looks like a clear bull flag, but bears have been trying to force the leading crypto below $9,000. There is a battle for this level, as the downtrend resistance squeezes price into a corner — and the result of this battle should play out within two days at the most.
Starting with the 1-hour for a granular view, we see price squeezed in between the EMAs above, and the $9,000 support level below. The entire formation is generally holding within support from the summer’s long consolidation (grey), and several deep wicks down attest to the bulls’ intention to keep BTC at $9,000.
It makes sense, because the longer Bitcoin holds $9k, the closer it moves toward the downtrending resistance of this post-surge consolidation; very soon it will be forced back above this line and the EMAs, unless the bears can beat it down through the blue support block within the day.
Moving to the 3-hour, we can see that the 55 EMA is holding price well as support (being tested at time of writing), while the 21 has acted as resistance. The RSI has been downtrending for the past few days, but has a chance right now to hold the latest support. The histogram is seeing a bull divergence and higher lows, but is currently looking like it wants to arch down.
We can clearly see that the range between the 55 and 21 is just about to slam into resistance, within the next two days at most. We should know whether Bitcoin wants to go up or down within that timeframe.
Finally, on the weekly to frame the entire picture, we see that the 21-week EMA is playing a big role in this market structure, sitting at exactly 8985 on Coinbase. We’re getting much less volume so far in the week, indicating that many buyers from last week are holding their bitcoin.
On the RSI, we see that 55 is a somewhat important level, supporting the 2019 runup; and that this level has rejected Bitcoin on the weekly. The histogram, after surging hard up last week, is going to need a lot more upside before this week’s candle closes if it wants to maintain its current trajectory.
In summary, the fight for $9,000 is building as Bitcoin is squeezed into the last corner of this consolidation. The bulls have been dedicated in their defense of this level, but they will have to renew that dedication during the next two days in order to effect a breakout — just to avoid a break down.
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Featured Image Credit: Photo via Pixabay.com
