BTCUSD Price Technical Analysis – Trend is Your Friend?

BTCUSD Price Technical Analysis - Trend is Your Friend?

BTCUSD Price Key Highlights

  • BTCUSD price has slowly been trending higher, moving above a rising trend line connecting the latest lows of price action.
  • After climbing to a high of $383.04, BTCUSD price is showing signs of pulling back to the rising trend line and Fibonacci retracement levels.

BTCUSD price might be ready to resume its climb if any of the Fib levels on the 4-hour time frame hold as strong support.

SMA Dynamic Support

For now, it looks like bitcoin is also finding support at the long-term 200 SMA, which typically holds as a dynamic inflection point. The 100 SMA is safely above this longer-term moving average so the path of least resistance is to the upside and the rally is likely to carry on.

The 200 SMA support lines up with the 50% Fibonacci retracement level around $350. A bounce off this area could push BTCUSD price back up to the previous highs around $380 and beyond. A larger correction, on the other hand, could lead to a test of the 61.8% Fib near $340 and the rising trend line.

This area would be the line in the sand for any retracements since a break below that area could signal that a reversal is underway. Stochastic is moving up but is approaching the overbought levels, possibly drawing sellers back in the game.

Meanwhile, RSI is still moving up, just making its way out of the oversold region earlier in the week. This suggests that there may be enough buying pressure in play to lead to a climb up to the previous highs. The average directional index is treading above 50.0 to indicate trending market conditions, but it looks ready to turn lower to indicate a return to range-bound action.

Intraday support level – $340

Intraday resistance level – $380

Technical Indicators Settings:

  • 100 SMA and 200 SMA
  • Stochastic (8, 3, 3)
  • RSI (14)
  • ADX (14, 14)

Charts from Bitstamp, courtesy of TradingView

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Samuel Rae is an active retail trader across a variety of assets, including currencies, stocks and commodities and the author of Diary of a Currency Trader (Harriman House). His personal strategy focuses primarily on classical technical charting patterns with a fundamentally supportive bias, combined with a strict, risk management-driven approach to entries and exits. He is an Economics graduate from Manchester University, UK.