On May 26, Bitcoin (BTC) began a rapid upward movement. A high of nearly $9000 was reached the same day. A higher high of $9109 was reached on May 30 before a downward move brought the price close to $8000. At the time of writing, Bitcoin is trading at $8228. Where will it go next? Keep reading in order to find out.The closest resistance area is found near $10000. If the price continues to increase within the confines of the channel, it is likely to reach this area in the middle of June. While this is possible, we do not believe it is likely. Even if the price reaches this area, a breakout above it would be very unlikely. The closest support area is found near $7200. We believe that the price will eventually reach this area. Do you think the price of Bitcoin (BTC) will break down? Let us know your thoughts in the comments below! Disclaimer: This article is not trading advice and should not be construed as such. Always consult a trained financial professional before investing in cryptocurrencies, as the market is particularly volatile.
BTC: Trends And Highlights For May 31, 2019
- The price reached a high of $9109.2 on May 31.
- It is trading in an ascending channel.
- The price is below the 10-day moving average but above the 20-day moving average.
- A bearish divergence is developing in the RSI and the MACD.
- There is resistance near $10000 and support near $7200.
Tracing the Current Trading Pattern
The price of BTC/USD on BITFINEX was analyzed at four-hour intervals from May 10 to May 31 to trace the current trading pattern.On May 12, the price reached a low of $7085.2. A gradual increase began. The price reached a high of $8194.1 on May 14. Since then, the price has been trading inside the ascending channel outlined below: The resistance and support lines have both been touched four times. After reaching a high of $9109.0 on May 30, the price began a rapid downward move. It reached a low of $8005.0 the next day, validating the support line. Will the price break down from this channel? In order to predict that, a look at technical indicators is required.
To better assess possible future price fluctuations, the price of BTC is analyzed alongside the 10- and 20-day moving averages (MA) below:
On May 30, the price dropped below the 10-day moving average and touched the support line. It is still trading above the 20-day one. Furthermore, no bearish cross has occurred yet. BTC dropped below the 10-day MA on May 15 and 22. After touching the support line, it began rapid upward moves toward the resistance line of the channel. Will it do the same for the third time? To determine whether it will, the price of Bitcoin is analyzed at daily intervals alongside the RSI and the MACD below: Since reaching the high on May 14, the RSI and the MACD have been generating lower values. This is in stark contrast to the significantly higher highs we have observed with the price. This is known as bearish divergence and often precedes price decreases. This divergence is also present in the three-day time-frame, but not in the weekly one. Furthermore, there is another instance of long-term divergence since the price reached highs of $5335.5 on Apr 1. However, this divergence is only present in the RSI. Together, these indicators suggest that price will likely break down from the channel. While it is possible that short-term increases within the confines of the channel will occur, we believe a breakdown is inevitable.
Support and resistance areas for BTC/USD are traced in the graph below. The resistance areas should help us gauge how high BTC may go before a reversal while the support areas should help gauge critical thresholds following a reversal.
In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions.