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• As at Wednesday, there was an uprising as Bitcoin jumped above $7,400 , confirming a bullish breakout on the technical charts with short duration.
• In the next 48 hours, the could be a resistance at $7,800. Any violation there could actually expose $8,200.
• Any breach from Wednesday low of $6.848 could spell doom for the new recovery. Although as at press time, it looks unlikely to happen.
On Wednesday, Bitcoin scraped the biggest single-day gain in four weeks leading to a confirmed short-term price breakout. This has given an opportunity for a test of resistance at $7,800.
A UTC close at $7,528 on Bitstamp, representing a 5.15 percent gain on the daily opening price of $7,168 was printed on Bitstamp by the popular crypto- Bitcoin.
Bitcoin rose by 6.81 percent and printed highs above $10,300. On that day, this happens to be the biggest single-day price rise since Oct. 26.
The whole scenario changed as prices dropped to $6,850, but were quickly reversed and the popular cryptocurrency ended the day on reassuring note, validating the seller exhaustion signaled by key technical indicators.
If we take cognizance of the account, the rejection of lower prices seen during the European trading hours, then Wednesday’s gain appears more impressive.
Above all and more importantly was the fact that, BTC activated twin bullish cues on the intraday charts with a convincing move above $7,400 and in the short-term, it could continue to draw bids.
On Wednesday as at press time, BTC has hit a high of $7,670 during the U.S. trading hours as it changes hands at $ 7, 480.
The path of least resistance is to the higher side as there is a breakout in the inverse head-and-shoulders and also an upside break from descending trend line.
There is a transition from the lower-highs, lower-lows created to one of higher lows and higher highs as the latter shows. Now. if it appears following a significant price drop as can be seen here, then it can be taken as a potent bullish reversal pattern.
Looking at the target, the bullish reversal pattern has created room for a rally to $8,200.
Meanwhile, on the highway at horizontal path, the pair may face resistance at $7,800 and the descending 100-candle average at $7,936 presently.
In some days to come, it looks set to cross above the 200-hour average, we can witness the 50-hour average beginning to trend north –which shows a sign of strengthening upside momentum. There could be a stronger buying pressure, possibly yielding a rally to $7,800 caused by the impending bull cross.
These notwithstanding, if the current three-day candle closes Friday, UTC above $7,380, a short-term bullish reversal would then be confirmed.
Wednesday’s low of $6,848 is essential on the downside, but if breached with strong volumes, could shift risk in favor of a re-test of $6,500, thereby affecting recovery.
Your comments are welcomed.
Disclosure: No cryptocurrency assets held by the author as at the time of writing.
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