On May 7, the Bitcoin price created a bullish engulfing candlestick, increasing by more than $1,000 throughout the day. This caused the price to move above a descending resistance line that had been in place since December 2017.
The breakout occurred with significant volume, but not particularly extraordinary. The price is approaching the next resistance area, found between $10,300-$10,400. This zone served as a top for two upward moves in October 2019 and March 2020.
Bitcoin Support Line
When looking at the six-hour time-frame, we can see that the BTC price is following an ascending support line, having validated it twice. This same line acted as resistance before April 28, but after breaking out, it has been validated as support. As long as it is staying above this line, it’s outlook can be considered bullish. However, the RSI has generated very significant bearish divergence when looking at highs reached on April 30 and yesterday. This suggests that the price is likely to decrease, at least to validate this ascending support line once more.
Long-Term Movement
The weekly chart better reveals the resistance line the price just broke out from. The most likely move from here would be a touch of the $10,300 resistance area, followed by a decrease to validate this line and another upward movement towards $12,000. BeInCrypto has previously outlined a wave count that fits with this possible scenario. However, the bearish possibility that the price will create a very long upper wick similar to what was seen in July 2019 and will decrease below the resistance line. A weekly close above this line would mostly invalidate this possibility.
Disclaimer
BeInCrypto strives to provide accurate and up-to-date information, but it will not be responsible for any missing facts or inaccurate information. You comply and understand that you should use any of this information at your own risk. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.
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