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Bitcoin Price Analysis: Defense of Major Support May Fuel Bounce to $9.6K

November 1, 2019 at 2:25 PM | By Jit Sutradhar Markets

Look

  • Bitcoin repeated defense of the support an average of 200 days indicates the end of the withdrawal of $ 10,350 and the scope for a bounce to the 100-day average at $ 9601.
  • A close above that level UTC and further gains above $ 10,000 can not be ruled out, as the latest pullback from the $ 10,350 shortfall volume support.
  • Acceptance under the hourly chart support at $ 8977 would weaken the case for mental in the next 24 hours.

Bitcoin looks primed to bounce price of $ 9,600, having repeatedly defended the long-term support in the last 72 hours.

Cryptocurrency on the market value started the week on a negative note with shedding 3.56 percent on Monday. Specifically, BTC formed a candlestick with a long upper shadow in the day, exhausted shoppers signal and open the door to a deeper decline for the former resistance-turned-support at $ 8820.

So far, however, the downside has been limited to about the 200-day moving average (MA), is widely tracked barometer of long-term market trends.

cryptocurrency which slipped to $ 8985 on Thursday, below its 200-day MA, but soon recovered. On the same line, under lock dip Tuesday the average is shallow and short-lived.

Similarly, BTC came close to testing the MA at $ 9046 during Asian trading hours today before jumping back to the highest level near $ 9,200.

repeated defense of the great support shows a low volume pullback from a high of $ 10,350 until last Friday was likely to end and the risks tilted upward.

In writing, BTC changed hands at $ 9.120 on Bitstamp, representing a 0.40 percent gain on a 24 hour basis.

Daily graph

Daily chart

BTC defend the 200-day MA for the third consecutive day.

cryptocurrency which formed a doji candle on Thursday, which happens when the market witnesses a two-way business and the day near the flat end (UTC). Typically, the candlestick pattern is taken as a sign of confusion in the marketplace.

The latest pattern, however, has emerged following a pullback to $ 1,000 from $ 10,350 and represent confusion or fatigue between sellers near the 200-day MA support.

As a result, bounce, perhaps to the 100-day MA at $ 9601, maybe soon in the next 24 hours or more.

Note that trading volume dropped as prices pulled back from $ 10,350 to $ 9000. A low volume pullback often upside down, so that, the rally all the way back to $ 10,350 could be on the cards.

Bitcoin has failed three times in six days closing above the 100-day MA. Therefore, if the bulls can pull off near UTC on average, is likely to invite a stronger buying pressure and causing movement of over $ 10,350.

3-day chart

three-day-chart

Bitcoin jumped 28 percent in three days to Oct.27, reinforces a bullish outlook presented by the 100-candle MA moves above the 200-candle MA (bull cross) was confirmed in mid-October.

Furthermore, a sharp rise was also supported by the highest trading volume since February 2018. The path of least resistance, therefore, is on the higher side.

Hourly chart

Hourly chart

Case to go up to $ 9,600 in the next 24 hours will weaken if the horizontal line support at $ 8977 seen in the chart above are violated with strong volume.

It will expose the support line at $ 8820 (11 Oct high). No violations would prove costly as the next major support line near $ 8,400 immediately.

Disclosure: The author does not hold cryptocurrency assets at time of writing.

Bitcoin image via Shutterstock; charts by Trading View

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