Bitcoin (BTC/USD) Price Technical Analysis for April 18, 2018

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Bitcoin recently broke out of its descending triangle pattern to signal that a rally is underway. However, price has stalled on its climb to suggest a potential correction that would draw more buyers in.

Using the Fibonacci retracement tool on the latest swing low and high shows that the 61.8% level is closest to the broken triangle resistance, which might now hold as support. This is also in line with the 100 SMA dynamic inflection point.

The short-term moving average is below the longer-term 200 SMA for now to signal that the path of least resistance is to the downside. However, the gap between the two is narrowing to indicate an imminent bullish crossover that would draw more buyers in. The 200 SMA is closer to the 38.2% Fib, which might be enough to keep losses in check if the pullback is shallow.

Stochastic is still heading down to indicate that there’s some bearish pressure left, but the oscillator is nearing oversold conditions to reflect exhaustion. RSI has more room to move south, which suggests that the correction could go on for a bit longer until it hits oversold levels.

A small head and shoulders pattern can also be seen on the short-term time frames, also indicating that selling pressure is mounting. After all, bitcoin has staged such a strong breakout that profit-taking would likely follow from here. Dollar demand has also ticked higher on account of upbeat medium-tier data and cooling geopolitical risks.

Still, longer-term prospects for the cryptocurrency suggest that gains could go on from here. The acquisition of Earn.com by Coinbase suggests further developments in the space as companies leverage existing technologies to offer better services to a growing market. It has also been reported that the likes of Soros, Rockefeller, and Rothschild are investing in the space.

The second quarter of the year has been historically positive for bitcoin, so it won’t be a surprise to see traders trying to take advantage of this tendency, especially after the tax filing deadline passes.

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