In the previous Bitcoin price analysis, we had concluded that Bitcoin is going through a healthy correction and market participants should use it as an opportunity to create light long positions by placing a stop-loss below the support of $235.
As can be seen, Bitcoin has rebounded swiftly after retesting the support line and this may initiate the second leg of the rebound. The target for the upside is $260.
Take a look at the latest technical factors keeping the cryptocurrency afloat.
Bitcoin Chart Structure – Currently trading at $240.70, Bitcoin is only slightly up from yesterday’s $239.03. The highlight of the yesterday’s session i.e. the support retest and the subsequent rebound should give confidence to the bulls.
Fibonacci Retracements – A factor which earlier limited the appreciation in Bitcoin price may not do the same this time. The 38.2% Fibonacci retracement of $243.84 may be taken out in the next attempt.
Moving Average Convergence Divergence – The Histogram maintains its flattish bias even as both MACD and Signal Line continue to erase losses. The latest values of MACD, Signal Line and Histogram are -2.3088, -5.4478 and 3.1390 respectively. MACD entering the positive territory is a bullish sign for Bitcoin.
Money Flow Index – The MFI is easing down from higher valuations as Bitcoin trades on a flat note. The latest MFI value is 56.5244.
Relative Strength Index – One aspect undermining the bullish nature is the closer-to-neutral value of 51.1856 as the latest RSI reading.
Bitcoin is looking positive from a near-term perspective, however, market participants must keep a tight, closing basis stop-loss below the support of $235.
Although I am expecting the level of $244 to be breached soon, the level of $250 which is the 200-day simple moving average may resist the upward momentum.
The technical indications also do not foretell of a volatility spike in the coming sessions.