Bitcoin Price Highlights
- The Bitcoin price is trading inside of an ascending wedge.
- The RSI & MACD have generated a bearish divergence.
- There is a possible triple top in play.
- The price might have broken out above the long-term resistance line.
- The 200-day MA is still offering resistance to the price.
Bitcoin in an Ascending Wedge
The Bitcoin price is still trading inside an ascending wedge. While it increased yesterday, it respected the resistance line of the wedge and has yet to break out. At the time of writing, the price had created a doji right at this resistance line.
In addition, the same bearish divergence is still intact, present in both the RSI & the MACD. Volume has been decreasing throughout the movement, creating skepticism about a possible breakout.
The short-term time-frames such as the hourly one could hold the key in determining the future direction of the price.
While it is in the process of breaking out, the price created a long upper wick. In addition, volume was highest in that bearish hourly candlestick. Therefore, if the price were to decrease and the current candle become a wick, the movement could be considered as a triple top, which is a bearish reversal pattern.
This would fit in with the resistance line of the wedge, and the bearishness for medium-term time-frames. On the other hand, a decisive close above this wick would also entail a close above the resistance line, pointing to a breakout.
The daily time-frame gives a contrary outlook to the one from short-term time-frames. In the daily time-frame, the price is in the process of moving above the long-term descending resistance line, a decisive breakout above which would confirm that the downward trend that began on June 24, 2019 has ended.
However, the price is facing resistance from the 200-day moving average (MA) and the 0.382 Fib level. Since the daily candlestick has more than 12-hours left until closing prices, this could turn into a long upper wick which would cause a breakdown. On the other hand, a bullish engulfing candlestick that decisively moves above the MA is possible, but seems unlikely due to the short-term bearishness.
To conclude, the Bitcoin price has reached a major resistance area. While the long-term outlook reveals that the price is breaking out, the short-term one is still bearish. As long as the price is trading inside the short-term ascending wedge, we are still leaning towards a breakdown.
Good luck and happy trading! For our previous analysis, click here.