Bitcoin on Saturday crossed above the $6,500-mark but lacked further upside momentum near the psychological resistance.
The BTC/USD kickstarted the day forming higher lows towards 6475-fiat. The Asian trading session witnessed consolidated action within a narrow range defined by 6520-fiat to the upside and 6477-fiat to the downside. A breakout action appeared only during the early European session when BTC/USD formed higher highs towards 6550-fiat. As the day matured, the pair also gained upside momentum towards 6572-fiat. Since establishing the intraday high, BTC/USD has been correcting towards the 6500-support.
BTC/USD Technical Analysis
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Bitcoin value in medium-term is capped by a descending trendline formation, so a sustainable bullish bias cannot be guaranteed. True, the situations are better on smaller timeframes, in which most of the technical indicators are favoring a strong buying sentiment. But the upside is further capped by a recently broken ascending trendline (depicted in blue) that is providing additional bearish pressure to the trend in medium-term.
On 4H timeframe, we have BTC/USD trending amidst its 50H and 200H moving averages, while the 100H MA is far above where the price is at the time of the press. A break above 200H MA could improve bullish sentiment and promise an extended upside towards 6700-fiat. However, a pullback will be imminent as the RSI and Stochastic indicators would attempt corrections from their respective overbought areas.
There is also a purple ascending trendline forming as a support to the near-term uptrend. If it is broken to the downside, the sentiments in near-term will be pushed towards bears, meaning a fall towards 6400-support could be highly possible.
BTC/USD Intraday Analysis
Coming to our intraday analysis, we are initially waiting for BTC/USD to test the ascending trendline for a potential bounce-back/breakdown. If the pair bounces back, we would enter a long towards 6590-fiat, our intraday high. In this position, we would keep a stop loss just 3-pips below to protect our trades from additional losses in the event of a bear retracement action.
In another case, if BTC/USD breaks below the ascending trendline, we would first wait for it to test 6500-fiat as its psychological support. If price bounces back from 6500-fiat, it would have us put another long position but towards 6550-fiat. If price breaks below 6500-fiat, we will look for a run towards 6400-fiat, the ultimate support level of the near-term bullish trend. In all the short positions, we will keep our stop losses 3-pips above the entry point.
Featured image from Shutterstock. Charts from TradingView.