BTCCNY Price Technical Analysis: Next Upside Targets

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BTCCNY has resumed its strong rally after a bit of a pullback and some hesitation below 5000.00. Price has now broken past its yearly highs and is making a run for the next long-term resistance levels.

Looking at the weekly chart shows that the next area of interest is located around 5500.00-6000.00 at which profit-taking off these recent rallies cold take place. A move past those levels could take BTCCNY up to the next highs at 7000.00.

The 100 SMA is above the 200 SMA for now but is moving very close, signaling that a downward crossover is still possible. If that happens, selling pressure could return and spur corrections from these rallies. RSI is on the move up so BTCCNY could follow suit but the oscillator is already indicating overbought conditions, which suggests that bullish momentum is weakening.

Stochastic is also in the overbought region, hinting that the rallies are already overdone. But until the oscillator crosses lower, buyers could have enough energy to push price up to the next ceiling at 5500.00. A move lower could inspire a pullback to 5000.00 at which more bulls could be waiting with long orders. A larger correction could last until 4750-4800.

BTCCNY Price Technical Analysis: Next Upside Targets

Chinese investors have ramped up their bitcoin activity once more as the government sought to weaken the local currency by setting the trading range lower. China wants to maintain a weak yuan in order to have an advantage in international trade, as a lower domestic currency makes its exports cheaper and more affordable for other nations. However, mainland investors with yuan-denominated holdings are seeking to hedge these falling returns by holding bitcoin against yuan.

A few weeks back, it was rumored that Chinese officials are looking into ways to restrict bitcoin trading in the mainland, possibly introducing limits into the amount of cryptocurrency being bought and sold in the country. However, industry experts noted that this wouldn’t be easily implemented given the nature of the bitcoin network and blockchain, thereby renewing interest in BTCCNY.

Risk-off flows from all over the world also seem to be back, as market watchers are turning their attention to other geopolitical risks. Among these are the upcoming elections in France and referendum in Italy, as the outcomes of nationwide votes like these tend to go against the status quo and inflict more uncertainty in the financial markets. In these times, bitcoin tends to enjoy an influx of long positions against fiat currencies.

For now, it seems that China is still the main driver of bitcoin flows as any adverse updates from the mainland could still push BTCCNY back down. The line in the sand for the long-term uptrend is 4000.00 and it’s hard to imagine a scenario that could push price below that level. BTCCNY is more likely than not to sustain its climb all the way until the end of the year, although large pullbacks are possible given the strength of the recent moves.

Keep in mind also that bitcoin volatility tends to rise leading up to the weekend and until the market open on Monday so wide stops are recommended when trying to hop in these longer-term trends. Also, event risks such as Yellen’s testimony are lined up and this could have a material impact on global market sentiment.

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With an upbringing rooted in deep ethical values, Yashu Gola knows how to put honesty and dedication into his articles. This young and dynamic financial analyst has done his graduation in IT engineering. His interests in financial writing have once brought him to our digital doorsteps. Since then, he has been an integral part of ForexMinute.com and writes the most captivating news-articles on the foreign exchange industry, cryptocurrencies, and medical marijuana trading.