BTCCNY is currently consolidating inside a rising wedge formation as price made higher lows and higher highs. A breakout seems to be underway as price is approaching its all-time highs.
If an upside breakout materializes, BTCCNY could set a new record high once more. The 100 SMA is above the longer-term 200 SMA so the path of least resistance is to the upside. In other words, a move higher is more likely to take place than a selloff.
In any case a breakout from the wedge pattern could last 4000.00 points since this is approximately the height of the chart pattern. A break below support around 18000.00, however, could still find a floor at the nearby 100 SMA dynamic support around 16000.00.
Stochastic is already indicating overbought conditions but has yet to turn lower. Still, this suggests that buyers are feeling exhausted from the climb and might be ready to push ETHXBT back down.
RSI is still on the move up to show that there’s still some buying pressure left for more gains, but it could also turn lower once profit-taking happens. Bulls might be keen on locking some gains at these recent highs unless there are significant catalysts for a big move higher.
Economic data from China has been less upbeat lately, with the PMI readings indicating weaker expansion across both manufacturing and non-manufacturing industries. Trade balance and CPI are still due next, but another round of disappointments could drive Chinese investors away from their local markets and onto bitcoin.
Apart from that, BTCCNY got a boost from reports that top bitcoin exchanges are resuming withdrawals for clients. This eased fears that government regulation will restrict bitcoin trading from earlier this year, leading to a fresh influx of funds to the cryptocurrency.
To top it all off, persistent geopolitical risks could keep bitcoin supported across the board. For one, the upcoming UK snap elections could set the tone for Brexit negotiations and therefore the future of the European region. Meanwhile, the conflict with Qatar in the Middle East also keeps uncertainty and the threat bigger rifts in the region in play.