After the flash crash previous week, in which crypto market lost close to 15 per cent of its value, the market now is slowly gaining momentum. The strength in the market is coming from lead cryptocurrencies like Bitcoin and Ethereum, both of which have gained significant value over the 24 hours period. Bitcoin is trading near the $6,500 level and Ethereum crossed the crucial $200 level gaining over 10 per cent and is currently trading near the $210 level.
We can see that in the past several times, Bitcoin has managed to bounce higher from the $6,200 level, which has formed a major support zone. But, after that, it trades in a range bound fashion with an occasional spurt in value. Currently, the $6,500 level is offering a strong resistance to BTC prices and break above from here could lead the market towards the $6,800 level. There will not be any major breakouts to happen as the market seems to be lacking both fundamental and technical push.
The technical indicating of a small bullish rally in Bitcoin with Stochastic moving up from the oversold territory and MACD is hanging around the neutral level showing signs of positive divergence. Given the extremely volatile nature of Bitcoin, it is better to follow the short-term trading momentum, which will help you to play the market safely.
Also, if we see the daily chart from the start of this year, it seems to be following a certain pattern. After every cycle of correction, Bitcoin is failing to match or go past its previous high level thus forming a downtrend line which it needs to breaks in order to go higher.
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