Bitcoin has formed lower highs and found support around $6,100, forming a descending triangle seen on its daily time frame. Price looks ready for a test of the resistance and might make another attempt to break higher.
However, the 100 SMA is below the longer-term 200 SMA to indicate that the path of least resistance is to the downside. In other words, the selloff is more likely to resume than to reverse. The 100 SMA already appears to be holding as dynamic resistance also.
A break past the triangle top around $6,600 could lead to a test of the 200 SMA dynamic inflection point next. A move past this area could be enough to confirm that a longer-term climb is in order. In particular, the price could climb by the same height as the triangle formation.
Stochastic is still heading up to show that there’s some bullish pressure left. However, this oscillator is also approaching overbought levels to show exhaustion among buyers and a potential return in selling pressure. RSI has more room to climb but also appears to be treading sideways to reflect consolidation.
Bitcoin price has drawn some support from the SEC decision to prolong its comment period on the proposed rule change by VanEck and SolidX. This should allow their bitcoin ETF to be listed on the exchange, but the regulator has deemed it necessary to get more input from the public before making a decision.
This isn’t the first time that the SEC has made such kind of announcement, although it seems to have kept hopes up that an approval may still be possible. Keep in mind that market participants are also looking at this potential approval as a likely catalyst for a strong rebound to record highs before the end of the year.
Looking ahead, any indication that an approval may be in order could keep lifting bitcoin as traders would likely rush in with long positions before it is made official.
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