Bitcoin (BTC/USD) Price Technical Analysis for Nov 28, 2017

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Bitcoin price has surged to yet another set of highs, but oscillators are showing signs of exhaustion and a potential pullback. Applying the Fib tool on the latest swing low and high shows that the 50% level could serve as near-term support.

This retracement level lines up with the ascending trend line connecting the lows of price action since mid-November. It is also in line with the 100 SMA dynamic support at the $8500 major psychological level.

Speaking of moving averages, the 100 SMA is safely above the longer-term 200 SMA to signal that the path of least resistance is to the upside. This means that the rally is more likely to continue than to reverse.

The 200 SMA is closer to the 61.8% Fibonacci retracement level and might be the line in the sand for this uptrend. This means that a break below the 200 SMA could signal the start of a longer-term selloff for bitcoin.

Stochastic has moved down from the overbought zone yesterday but has pulled right back up as bulls remained in play. RSI is slowly edging lower to reflect a pickup in selling pressure. The correction could carry on until both indicators hit oversold regions and turn back up.

Bitcoin has drawn a lot of support from the increase in investor activity owing the addition of around 100,000 Coinbase accounts from Wednesday to Friday last week. The subsequent price rally has also drawn traders to reestablish their long positions which they booked profits from ahead of the Thanksgiving holidays.

Meanwhile, the dollar is still under some selling pressure after Fed head Yellen and FOMC policymakers shared less upbeat views on inflation, citing that it could take longer before the 2% target is reached. FOMC member Kashkari echoed this sentiment in his testimony this week, casting doubts that more rate hikes are in the cards for 2018.

Tax reform progress could also have a significant effect on dollar direction this week while bitcoin could continue to take cues from volumes and market sentiment.

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