A new MTF (medium timeframe) uptrend looks locked in now, as Bitcoin (BTC) has taken some strong legs up in the past couple of days after finding support over the weekend in a clear support zone. The leading crypto yesterday tested $9,100 for the second time in January, and the level seems unlikely to hold the new uptrend for long.
We start on a 4-hour chart, and see that Bitcoin has plowed through the $8k range in the past two days and retaken the resistance zone from earlier in the month, just under $9,000. $9.1k is a critical level, and if it breaks, we essentially confirm an end to the H2 2019 downtrend (more on this later).
This may have to wait, though, as the indicators on this chart look overcooked: the RSI is in overbought territory, and the histogram has started to point down after an intense rise. However, with things clearly looking bullish and the MTF trend clearly up, this pullback is more likely to be brief.
Moving to the daily, we get a better sense of the resistance that Bitcoin is currently chewing through, and how close it is to break it. We’re currently in the middle of the second attempt to break $9,100; but this time, the attempt comes toward the beginning of an MTF uptrend, rather than at the end of one like on 19 January.
Volume is looking good on Bitstamp, with nearly half yesterday’s volume while being not even halfway through today’s trading. We see a flat bullish expansion on the histogram, which could easily cross positive today or tomorrow. Only a serious rally from the bears will hold this uptrending momentum.
Finally, looking at the weekly to get a HTF context, we see that BTC is very close to confirming a break of the HTF downtrend. The RSI is nibbling at the historical bullish inflection zone, starting at 54%; and the histogram is just now crossing back into positive territory for the first time since August.
Things could still go south: a concerted bear rejection at $9,100 could be disastrous for the leading crypto, and being sent back down into the bear channel from here would probably mean another six months – or more – of downtrending.
But as it stands, this looks unlikely, and the trend simply looks bullish. Bitcoin held well during last week’s critical retest, and the fruits are blooming this week.
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