Key Points
- Bitcoin price made a nice move higher and even settled above the $400 resistance area.
- There is an ascending channel pattern formed on the hourly chart (data feed from Bitstamp), which may continue to act as a catalyst for an upside move.
- The next level of resistance on the upside can be around the $420 level where sellers may appear.
Bitcoin price broke a major resistance area of $400, and if sellers fail to take a stand, then a move towards $420 is possible moving ahead.
Bitcoin Price Heading Towards $420?
Bitcoin price recently enjoyed a decent upside run and buyers were seen under control. The price even managed to clear a major resistance area of $400, which is a positive sign. Currently, there is an ascending channel pattern formed on the hourly chart (data feed from Bitstamp), which is acting as a support and taking the price higher. The price is facing a minor resistance around the channel resistance area and $406, which may ignite a minor correction back towards the channel support area.
The $400 handle may now act as a major barrier for sellers, and can be seen as a support area as it is also coinciding with the channel lower trend line. Moreover, the 23.6% Fib retracement level of the last wave from the $382 low to $406 high. The price is well above the 100 hourly simple moving average, suggesting that buyers are here to stay and more gains are likely in the near term.
If you are looking to trade in the short term, then consider buying near the channel trend line and support area with a stop as an hourly close below it.
Looking at the technical indicators:
Hourly MACD – The hourly MACD may change the slope to bearish, which is a contradicting signal.
RSI (Relative Strength Index) – The hourly RSI is above the 50 level, calling for more gains.
Intraday Support Level – $400
Intraday Resistance Level – $406-08
Charts from Bitstamp; hosted by Trading View
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