Finally, after spending the past month hovering around the $7,500.00 psychological handle, bitcoin price was able to trade beyond this key resistance level. As of this writing, BTCUSD is trading around $7,750.00. Now the question is, will buyers be able to sustain their gains?
The 4-hour time frame suggests that there is upside potential to the cryptocurrency. A closer look at the recent price action of bitcoin price would reveal that a bullish flag chart pattern formed. In fact, BTCUSD looks like it is trading above the flag. This is typically interpreted as a sign that buyers are dominating market sentiment.
Meanwhile, the daily chart showcases the next potential resistance level for bitcoin price. Looking at the 100 SMA and 200 SMA, it seems that they are converging around the $8,000.00 psychological handle. If there are indeed enough buyers in the market, we could see BTCUSD make its way to this level soon.
On the other hand, if buyers lose their momentum, bitcoin price could fall. A close below the cryptocurrency’s April 24 low at $7,395.25 could mean that sellers are back in control. BTCUSD could then trade lower to $7,167.95 where it may test a confluence of support. For one, this price coincides with the rising trend line (from connecting the lows of March 30, April 16, and April 21) as well as the 100 SMA and 200 SMA. Additionally, it aligns perfectly with the 61.8% Fib level when you draw from the low of April 20 to today’s high.