On July 20, the Bitcoin (BTC) price decreased slightly. However, it kicked off today with a breakout above an important resistance level and moving average (MA).This could indicate that its consolidation period might be over.
Bitcoin Consolidation CrawlThe Bitcoin price had been consolidating below the $9,250 area, which has previously acted as support and resistance and was trading right below the 50-day MA. The daily RSI began trending below the 50-line, but shot off and is currently sitting at 62. There have been numerous long lower-wicks over the past two weeks. This mounting buying pressure likely helped BTC to blast through resistance. If this turns out to be a fake-out rally, the most likely level for support is found at $8,950—an ascending support line that began in May.
Current BreakoutThe hourly chart shows that the price has already broken out from a descending wedge, along with the 200-hour MA and a minor resistance level of $9,200. Furthermore, the breakout has transpired with extremely high volume, increasing its validity. This is a sign that the consolidation period has likely ended and BTC is heading higher. The longer-term chart also shows that BTC has broken out from a descending resistance line, which has been in place since the June 1 high of $10,380. The confluence of these breakout levels increases the possibility of a continued upward move. If the price continues increasing, as is expected, the next closest resistance areas are found at $9,450 and $9,700. While short-term retracements could occur in between, BTC is expected to eventually hit these levels. To conclude, the BTC price has broken out from a resistance line both in the short and the long-term, possibly indicating that the corrective period has ended. The price is expected to increase towards the resistance areas outlined above. For our previous analysis, click here.
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