Bitcoin has neither dumped nor has broken its crucial resistance level since August 15.
The BTC/USD on Monday started with a bullish promise after snoozing through the whole weekend. The pair confirmed 6346-fiat as a strong support and rose 3.5 percent during the early Asian trading session. As the day progressed, bulls began to lose their grip and price started slipping, only to find itself approaching 6346-fiat again. At the time of this writing, BTC/USD has stabilized amidst 6385-6483 area.
What’s noteworthy, however, is Bitcoin’s contrasting price action with respect to the altcoin market. Almost all the top coins have undergone extensive bearish corrections in the past 24 hours whilst Bitcoin continues to show a relatively stable approach, confirming dominance. Historically, an overlong sideways trend in the Bitcoin market has resulted in a major breakout action.
To study a potential breakout, we noticed an ascending triangle formation which, if stood the time, could tell the course of next week. The price is currently holding its leg near 6346-fiat while forming higher lows towards 6500-fiat. Any volatile upside action from here could bring the price closer to testing 6700-fiat in medium-term. The triangle range, in the meantime, offers pretty good opportunities to enter and exit positions on decent profits.
The BTC/USD meanwhile is closely above it’s rising 100H and sideways 200H moving averages, indicating a buying sentiment. The RSI and Stochastic Oscillator indicators are also indicating an upside correction, meaning the price could retest 6500-fiat anytime today. Overall, the bias is slightly bullish.
According to our intraday analysis, we are now looking at 6346-fiat as our interim support and 6500-fiat as our interim resistance. This is the range we are watching for today.
So, our first action would be to place a long position towards 6500-fiat, as a part of our intra-range strategy, while placing our stop loss a 2-pips below the entry position. In case we break above the resistance level, we will put another long towards ascending triangle resistance (~6650-fiat). Putting stop loss 3-pips below our entry position will define our risk management perspective.
Conversely, a pullback from resistance – or anywhere before – will allow us to enter a short position towards 6346-fiat, while a stop loss anywhere 3-pips above the entry position will minimize our losses in case the trend reverses.
Featured image from Shutterstock. Charts from TradingView.