Bitcoin Awaiting Breakout with Bullish Bias

Bitcoin Awaiting Breakout with Bullish Bias

Bitcoin has been choppy but bullish in May so far. Last week, after a bearish correction, price rebounded from about 226 to a high over the weekend around 249. It retreated and has since been trading in a consolidation range between roughly 238.50 and 246 as we can see in the 1H chart.

Bitcoin (BTCUSD) 1H Chart May 12
bitcoin 5/12
(click to enlarge)

Looking at the 1H chart, we can see that there is still a bullish bias while btcusd awaits a breakout from the current consolidation. Price is still holding above the 200-hour simple moving average and the RSI has tagged 80 and held above 40, tagged 80 and is still above 40. This shows maintenance of the prevailing bullish momentum from last week.

Now, a break below 238 with the 1H RSI falling below 40 would be a sign that the market losing the noted bullish bias. This would put the pressure on the 226-228 lows on the month, with risk of extending a bit lower. We will see in the 4H chart, that this would still be within the context of a bullish trend that started at the end of April.

Otherwise, going with the short-term trend, the pressure should be on the 246 and then 249 resistance levels.

Bitcoin (BTCUSD) 4H Chart May 12
btcusd 4h chart May 12
(click to enlarge)

The 4H chart also shows a market initiating bullish bias and momentum. Price is holding above the cluster of 200-, 100-, and 50-period SMAs while the RSI has tagged above 70 multiple times and has held mostly above 40.

Now, we noted that even a break below the May 9-11 consolidation range would be in the context of an uptrend, but only if price can hold above 232 and preferably respect the rising trendline coming up from 214, the April and 2015 low. A break below 232 would likely put pressure back on 226 and the 214 support pivots.

To the upside, a trend continuation in the short to medium-term has the 300-315 resistance area in sight.

Bitcoin (BTCUSD) Daily Chart May 12
btcusd daily chart 5/12
(click to enlarge)

We can see that the short to medium-term bullish outlook would still be within the context of 2015’s bearish-neutral market.

Previous Post by Author: Gold – Watch out for a Bearish Attempt for May 12th

Previous articleEURCAD Potential Short-Term FX Selloff
Next articleGBP/USD Makes New 2015 Highs ahead of Key Inflation Report
Fan Yang has been a professional forex trader and analyst since 2007. He specializes in technical analysis and has a Chartered Market Technician designation since 2011. He was the chief technical strategist at CMSFX He was also the founder and chief currency strategist at FXTimes Over the years, Fan has not only been a trader and analyst but also an educator. As a proponent of both technical and fundamental analysis in trading, Fan advocates simplicity and discipline as key factors in making trading decisions when faced with so many "clues" and "signals". Currently Fan Yang is the chief currency analyst and webinar instructor at