Bitcoin has increased on the short term and now is located above a very strong dynamic resistance. Price has continued to move sideways on the Daily chart, that’s why we really need a confirmation that we may have a larger upside movement in the upcoming period.
The breakout above the dynamic obstacle needs confirmation, so maybe will be better for you to stay away for now because we don’t have a great trading opportunity right now.
Bitcoin is trading at 7320 level, it has managed once again to jump above the 7000 psychological level, but remains to see if it will have enough directional energy to stay above this level and to approach the 8000 and 9000 levels again.
Price is narrowing on the Daily chart, so personally, I’m expecting to see a significant movement in the upcoming period.
The current upside movement is natural after the failure to close below the first warning line (WL1) of the ascending pitchfork and below the 6000 psychological level. Price has decreased after the false breakout above the upside line of the triangle pattern and after the failure to stabilize above the 150% Fibonacci line.
It has come back down to pressure the 6000 psychological level, has tested and retested this level and also the WL1. Personally, I would have liked to see a major false breakdown below the WL1 and below the 6000 level before the rate would have started to move higher again.
Unfortunately, the current upside movement can be only a temporary one if the rate will continue to move higher like this. Personally, I believe that the rate doesn’t have enough power right now for a larger upside movement.
Price could come back to test and retest the broken downtrend line and the WL1 before will try to move towards the 150% line.
I believe that a strong consolidation will announce a potential broader upside movement. You should also know that a valid breakdown below the WL1 could signal a potential sell-off that could take out the 6000 psychological level as well. We’ll have a great selling opportunity from below the 6000 level. You can go long on Bitcoin only if you can afford to place a Stop Loss below the 6000 psychological level and if the rate will make a consolidation in the upcoming days and weeks.