Bitcoin Analysis for 2019-12-12 [Premium]

The Bitcoin price is trading inside a short-term bullish pattern, which suggests a breakout towards $7350 will occur.

Bitcoin Price Highlights

• The Bitcoin price is trading inside a range between $6900 and $7600.
• There is a minor trading range between $7150-$7350.
• Short-term technical indicators are undecided.
• The price is facing resistance from daily moving averages.

Bitcoin’s Trading Range

The Bitcoin price has been trading inside of a range between $6900 and $7600 — besides two short-lived periods, which we will consider outliers. Inside this range, there is a more minor one between $7150-$7350. Last night, the price moved upward and touched the resistance line of this range before decreasing and creating a bearish candlestick. This suggests the Bitcoin price wants to move downward. Technical indicators do not give a clear verdict. On the bearish side, the long upper wick coincides with the resistance offered by the 100- and 200-hour moving averages (MA) which have just made a bearish cross. On the bullish side, the Bitcoin price is trading inside a descending wedge and has generated bullish divergence in both the RSI and the MACD. Since the descending support line of the wedge coincides with the support line of the minor range, it would be expected for the Bitcoin price to reach the support line before breaking out. Let’s look at different time-frames and see how likely this movement is.

Daily Outlook

The daily outlook provides a bearish picture. The Bitcoin price has twice retested the resistance area at $7800-$7900 that had previously acted as support, creating a long upper wick each time. Additionally, the failed attempts at moving higher and the length of time we have been trading below the resistance area makes it unlikely that we will have a movement similar to that on October 25, when the Bitcoin price reclaimed the resistance area and moved upward. Candlestick characteristics are also bearish, with the majority of red candlesticks having long upper wicks, or being engulfing, while green ones are smaller. This changes below $7000 where there is a presence of long lower wicks. The daily outlook suggests that, if a breakout from the short-term pattern happens, it will likely end near $7350 and the Bitcoin price will again drop to the minor support line and possibly break down. For our previous analysis, click here.