Bitcoin (BTC) rebounded from support and formed a bullish takeover
Bitcoin (BTC) reached a local low on June 8 at $31,000 and began a correction from the support level. The next day a bullish absorption candlestick pattern formed on the charts and bitcoin tested the high at $37,682
Technical indicators give mixed signals. For the bullish trend to be confirmed, the price must overcome a short-term resistance area.
Bitcoin (BTC) rebounded support
Bitcoin (BTC) hit a local low on June 8 at $31,025. The price then rushed upwards, creating a shadow with a long lower shadow. (green icon). A similar candlestick had already appeared on the charts of May 19 and 23, also after testing support at $31,000.
The next day, the price formed a bullish takeover and briefly crossed the $37,000 level. This is a powerful bullish signal.
Technical indicators do not give clear signals yet, though they hint at growth. The MACD has been moving up since May 19. However, it has not yet entered positive territory. Moreover, the signal line is below zero.
The RSI formed a bullish divergence (blue line) before the up move. But now it has also formed a hidden bearish divergence (red dotted line). Finally, stochastic has formed a bullish cross.
Thus, the technical indicators on the daily chart don’t give reliable information about the direction of the movement.
Key resistance levels for bitcoin are $41,400, $44,900 and $48,400. They coincide with the 0.382, 0.5 and 0.618 Fibonacci retracements. The latter is also a horizontal resistance line. A break above would confirm a bullish trend.
On the six-hour timeframe, technical indicators give a more optimistic picture. MACD is rising and RSI crossed the 50 line.
However, yesterday bitcoin bounced for the fourth time from the former support line of the descending channel. It is now serving as resistance (red icon). Until the price returns to the channel, the trend cannot be considered bullish.
The two-hour chart shows the downward resistance line from May 20. A breakout above this resistance is needed to confirm the trend.