erday, we described what is so far just a pause in Bitcoin’s (BTC) MTF downtrend. Today, this “pause,” in the form of a LTF uptrend still seems intact and Bitcoin is gaining a little steam. We could see another leg up today as a result.
Starting on the 4-hour chart, we see that yesterday saw a lot of chop for the leading crypto, and this is something we’ve seen a lot of in the past week as Bitcoin has searched for a local bottom.
The RSI trend is holding, and it’s the same trend that occasioned a small breakout from the local bottom two days ago. We would like to see this get above 50 on the 4-hour chart, to foster confidence in a leg up. The histogram is also building bullish momentum with a drawn out bullish contraction. Volume is also growing in the last eight hours as price slowly slogs its way up.
On the daily, yesterday’s candle stair-stepping up from the previous day’s opening, although price is still trapped under all of the EMAs. If we get a close today above the 8 EMA, we can probably anticipate a leg up to the 21 or 55 EMA as well.
The histogram is trending up in a flat (that is, mild) bullish contraction. But this indicator is still pushed deep into its negative zone, and it may take a while for it to even get near the positive side of the range. This is to say that we can’t expect too much bullish price action with this histogram profile; a downtrend still obtains.
We should continue to be realistic about this small base that Bitcoin has built. There is no reason why Bitcoin cannot continue lower, as there is plenty of room left on the retracement scale without even challenging the HTF structure.
The weekly histogram, absolutely thrashed last week, needs to start putting in a recovery, and we would like to see a strong angle of bullish expansion set this week. But we can take comfort from the fact that, mostly, the technicals are still bullish on the HTF.
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