BTCCNY continues to trend higher and is showing increased bullish pressure. Price is bouncing off the mid-channel area of interest and could be ready for another test of resistance.
This nearby support zone lines up with the 100 SMA, which has held as a dynamic inflection point. Still, an actual test of the channel bottom could halt at the 200 SMA dynamic support just above 4100.00. The 100 SMA is above the 200 SMA so the path of least resistance is to the upside and the climb is likely to continue.
Stochastic is on the move up so BTCCNY could follow suit and attempt to break past 4400.00-4450.00. Similarly RSI is heading higher, which means that buyers are in control of price action right now. A break below the channel support, however, could bring more sellers to the mix.
Economic data from China did little to support the yuan last week, even as the numbers were mostly in line with expectations. Traders still seem to favor higher yields from the cryptocurrency, especially with all the volatility in the forex market.
Besides, the drop in short-term consolidation merely provided buyers a chance to buy bitcoin at a much better price. If bullish pressure isn’t sustained from here, a larger correction to the channel support might be in the cards.
There’s not much in the way of economic catalysts towards the end of the week, although it’s helpful to note that volatility does pick up around this time. Earlier in the week, both the BOC and ECB refrained from adjusting monetary policy but hinted at a dovish stance, which could keep risk-taking and bitcoin supported from here.