Bitcoin (BTCUSD) 1H Chart 3/16 – click to enlarge
A Bearish Correction: After almost reaching 300, bitcoin stalled last week, retreating from 299 down to about 272 before finding support. As the 1H chart shows, price fell below the 200-, 100-, and 50-hour simple moving averages (SMAs), while the 1H RSI fell below 40 and even 30. This shows loss of the prevailing bullish bias and momentum in the 1H chart, and even suggested development of the bearish scenario. If price were able to hold below the cluster of SMAs and the 1H RSI held below 60, then the bearish outlook would continue to build.
Bulls Remain in Charge: However, as we can see in the 1H chart above, price was able to climb above the moving averages, and the RSI pushed above 60, showing loss of the prevailing bearish momentum and bias.
Bullish Breakout: Furthermore, we can see price breaking above a falling speedline, suggesting a bullish continuation scenario. If price falls in the near-term, look for support above 282 and the 1H RSI to hold above 40 if the market is indeed ready for bullish continuation.
Bullish Continuation and Key Resistance Ahead: The 4H chart shows a bullish market despite the choppiness last week. With the bullish breakout this week, price is poised to test the 300-handle. There is a previous resistance area between 300-310. The 2015-high is also around 315-320 and this area should see sellers. Now, a break above 320 would not only confirm that bitcoin has stabilized after the 2014-descent, but also hints at a possible bullish outlook in the short to medium-term with the price action in the first 3 months of the year as a price bottom to bounce off of.
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