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Bitcoin (BTC) Struggles to Break Above $10,000, Supportive Trend Remains

Bitcoin (BTC) Struggles to Break Above $10,000, Supportive Trend Remains

Nick Cawley, Senior Strategist


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Bitcoin (BTC) Price, News and Analysis:

  • Bitcoin continues to draw strength from a supportive trendline.
  • A bullish ‘Golden Cross’ formed yesterday.

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Bitcoin (BTC) Consolidating Ahead of a Potential Upside Breakout

The technical set-up for Bitcoin remains positive despite this week’s drift lower, and a further re-test of $10,000 big figure resistance cannot be ruled out. The supportive trendline off the March 13 spike low remains dominant and gained added credibility by holding both the May 10 and May 11 sharp sell-offs - between $8,150 and $8,200 - in check. Since then the recent BTC rally has resumed with the crypto making two attempts at breaking $10,000 without success. As support continues to push higher and begins to close in on resistance, a breakout nears.

Bitcoin is also finding support off the 20-dma (red line) and while this moving average has been pierced, BTC has not closed and opened below the dma, leaving short-term positive sentiment intact. The daily chart also shows that a bullish ‘Golden Cross’ formed yesterday – the 50-dma moving above the 200-dma – boosting longer-term positive sentiment in the crypto. Coming back to the short-term outlook, the 20-dma currently at $9,335 and the May 15 low at $9,145 may offer initial support, before the trendline appears around $8,950. As previously mentioned a close and open below this trendline negates the positive short-term outlook. A clean break above $10,000 and the May 8 high at $10,075 leaves the February 13 high print at $10,506 exposed. As the meeting of support and resistance nears, a breakout is looking increasingly likely.

Bitcoin (BTC) Daily Price Chart (November 2019 – May 21, 2020)

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What is your view on Bitcoin (BTC) – bullish or bearish?? You can let us know via the form at the end of this piece or you can contact the author via Twitter @nickcawley1.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.