Good Tuesday morning, traders. Bitcoin continued to move up overnight and has hit anywhere from $7055-$7126, depending on the exchange. This brings it to the resistance that we discussed during last night's stream at around $7086. But now what? Shorts don't appear to be taking the move too seriously as they haven't really begun covering yet. This signals to me that traders are still "sure" that price MUST go down. This is potentially good news for those waiting for the short squeeze, but also means that they are going to have to really buy to push price through resistance and set off the squeeze. With current RSI levels where they are on multiple time frames, this may have to wait until a retest of the $6800/$6850 support area as I spoke about last night. However, we can never discount the FOMO that retail traders create and buy into which, often in crypto, sends RSI to extremely high levels. My opinion, at this time, is that the shorts are the wild card. A squeeze prior to a retrace will likely send price spiraling upward and potentially all-but-max-out RSI levels, stretching the bounds of EW extensions in the process. This should also signal a likely new higher high above $8500. Until we break the $7300-$7500 area, however, traders must be wary as price can take a strong turn lower. For now, if price does not push up from this area, then I expect it to remain range bound between $6850 and $7100/$7150.
The 4H Bitfinex chart on the left shows price breaching the ascending triangle target and reaching the R2 pivot with a high of $7126. We can also see that price has breached the top of the potential ascending wedge. A clean break and close above this resistance should solidify upward momentum for now and I will be watching for that breach of $7500 to signal further advancement. Looking at 4H RSI on the move up in July, we can see that it hit overbought and remained there through most of the upward movement. This suggests that such a possibility is a realistic this time around as well, so the current RSI level shouldn't be too worrisome for traders especially with the possibility of a squeeze still in the cards. I have drawn a possible ascending channel that price may be printing as well, so traders should keep an eye on the that as the top should provide resistance on a move upward.
The 1D Bitstamp chart on the right shows price reaching that black horizontal line at $7086 which I pointed out last night that traders should be watching as it was the next immediate area of resistance. Price is also clearly above the ascending black dotted resistance line that starts with the November and February lows. Closing above the previously mentioned resistance areas should set up the descending black line resistance at the $7350 level as the next hurdle.
As always, I am live twice each week day at 10 a.m. and 9 p.m. CST offering a more in-depth look at price action on various charts, so join me if you get the chance. While I can't tell you where you'll find me, due to TV's advertising policy, I am sure you can find the streams quickly and easily.
The 4H Bitfinex chart on the left shows price breaching the ascending triangle target and reaching the R2 pivot with a high of $7126. We can also see that price has breached the top of the potential ascending wedge. A clean break and close above this resistance should solidify upward momentum for now and I will be watching for that breach of $7500 to signal further advancement. Looking at 4H RSI on the move up in July, we can see that it hit overbought and remained there through most of the upward movement. This suggests that such a possibility is a realistic this time around as well, so the current RSI level shouldn't be too worrisome for traders especially with the possibility of a squeeze still in the cards. I have drawn a possible ascending channel that price may be printing as well, so traders should keep an eye on the that as the top should provide resistance on a move upward.
The 1D Bitstamp chart on the right shows price reaching that black horizontal line at $7086 which I pointed out last night that traders should be watching as it was the next immediate area of resistance. Price is also clearly above the ascending black dotted resistance line that starts with the November and February lows. Closing above the previously mentioned resistance areas should set up the descending black line resistance at the $7350 level as the next hurdle.
As always, I am live twice each week day at 10 a.m. and 9 p.m. CST offering a more in-depth look at price action on various charts, so join me if you get the chance. While I can't tell you where you'll find me, due to TV's advertising policy, I am sure you can find the streams quickly and easily.