Bitcoin bulls were able to propel the cryptocurrency past a key resistance level overnight, with BTC rallying up to highs of $9,200 before meeting some resistance that has since led it to dip slightly lower.
It now appears that BTC is in the process of testing a key resistance level that marks a “line in the sand,” with its reaction to this level setting the tone for where it trends in the year ahead.
Technical analysis seems to suggest that the cryptocurrency is on the cusp of seeing significantly further momentum, which could mean that this critical resistance region will soon be decisively broken above.
Bitcoin Rallies Past $9,000 as Technical Strength Grows
Over the past few days, Bitcoin had been caught within a firm bout of rangebound trading, which had led the cryptocurrency to trading between highs of $8,900 and lows of $8,400 for several days.
Today’s upwards movement marks a bullish resolution to this bout of sideways trading and may suggest that the crypto will see further upwards momentum due to the technical strength that was generated as a result of this upwards break.
Rob Sluymer – a veteran institutional analyst – spoke about Bitcoin in a recent tweet, explaining that this recent rally is “important” because it comes close on the heels of a retracement to a key level.
“BTC looks to be making a potentially important turn to the upside after: 1) Stalling, yet again, at resistance between a 50-62% retracement of the 2H 2019 rally 2) Retracing 50% of the December-February rally back to a support band between 8.1-8.4K with daily RSI bottoming,” he explained while pointing to the below charts.
$BTC looks to be making a potentially important turn to the upside after:
1) Stalling, yet again, at resistance between a 50-62% retracement of the 2H 2019 rally
2) Retracing 50% of the December-February rally back to a support band between 8.1-8.4K with daily RSI bottoming pic.twitter.com/QAtixsNo0r
— Robert Sluymer (@rsluymer) March 5, 2020
BTC is Pushing Against a Key “Line in the Sand”
This potentially bullish bounce following Bitcoin’s intense retracement is leading the cryptocurrency up against a critical resistance level, with its reaction to this level setting the tone for where it trends in the weeks and months ahead.
Big Chonis, a well-respected analyst on Twitter, spoke about this level in a recent tweet, explaining that it is still acting as major resistance.
“BTC – another backtest of this level of previous major support still acting as resistance… if there was ever a ‘line in the sand’ it’s around this level…bitcoin daily chart,” he explained.
$BTC – another backtest of this level of previous major support still acting as resistance… if there was ever a “line in the sand” it’s around this level…#bitcoin daily chart pic.twitter.com/IQebJsLC5Y
— Big Chonis Trading (@BigChonis) March 5, 2020
If Bitcoin is able to decisively break above this level, it could give the benchmark crypto room to post a significant rally.
Featured image from Shutterstock.