Bitcoin Price Key Highlights
- Bitcoin price has rallied in the past few hours but also hit resistance on its channel.
- If this continues to keep gains in check, bitcoin could still resume the selloff to the support areas marked.
- Using the Fib extension tool shows the potential downside targets in the short-term.
Bitcoin price might still resume its downtrend as the top of its descending channel is keeping gains in check.
Technical Indicators Signals
The 100 SMA is below the longer-term 200 SMA to confirm that the path of least resistance is to the downside. In other words, the selloff is more likely to resume than to reverse.
However, an upward crossover appears to be materializing and if so, bitcoin price might still be able to break past the channel top. In particular, a move past the swing high around $8,600 could confirm that buyers have the upper hand.
RSI is dipping into oversold territory to show that sellers are exhausted and may let buyers take over. Stochastic still seems to have some room to fall, so bitcoin price might follow suit.
The nearest support area is at the 38.2% extension or $8,039 level at the mid-channel area of interest. The 50% extension is at $7,855 and the 61.8% extension is at the swing low or $7,671. Stronger selling pressure could take it down to the 78.6% extension at $7,410 or the channel support. The full extension is located at $7,077.4.
BTCUSD Chart from TradingView
Market Factors
A rebound in risk-taking paved the way for some bitcoin price gains after a trade truce between the US and China was announced. This supported commodities, equities, and other riskier assets like cryptocurrencies versus the dollar.
The main event for the US dollar is the release of the FOMC minutes this week as this could clarify tightening expectations. Hawkish remarks could mean more dollar gains versus bitcoin while cautious ones could allow the cryptocurrency to advance.
There have been no major headlines pertaining to bitcoin, so investors could keep holding out and staying cautious while waiting for more developments.