- Bitcoin could test the key resistance above $ 8,500 in the next day or two, having eked out the biggest rise in a single day in five weeks on Monday.
- The daily chart indicators have turned bullish with rising prices Monday.
- Acceptance below the moving average of 100 weeks (MA) to $ 7756 reviviría the event of a fall of $ 7,200.
Bitcoin (BTC) gain recorded price of a single biggest day in five weeks on Monday, opening the doors for increased stronger recovery key resistance above $ 8,500.
Top cryptocurrency by market value recovered from a historically strong support MA-100 week near $ 7,750 and closed (UTC) $ 8,205 in Bitstamp, representing an increase of 4.47 percent over the daily price of $ 7,863 opening. That’s the price increases single biggest day since 2 September.
At that time, the CTB had climbed 6.3 percent, confirming a bullish short-term reversal. The break, however, eventually creating a low tendency to lower maximum around $ 10,950 on September 6.
rising prices on Monday could be termed as a relief rally, as the cryptocurrency sought oversold after falling more than $ 2,000 in the last week of September. In addition, there were no signs of exhaustion seller under $ 7800, as discussed yesterday.
Many observers believe that the recovery rally could extend further resistance in row above $ 8,500 and about $ 8,600. For example, market analyst Josh Rager tweeted today that the price of Bitcoin could now run up to $ 8,500.
Rager said in another tweet that prices have to rise above $ 8,500 to invalidate bearish lower highs set and confirm a bullish reversal.
Popular @TheCryptoDog analyst believes that the likelihood of a selloff to $ 7,200 has been reduced with the rising price of 4.47 percent on Monday and a larger demonstration to $ 9,400 could be seen if the resistance at $ 8,500 is breached convincingly.
At the time of writing, the cryptocurrency leader is changing hands near $ 8,200 in Bitstamp, after reaching a maximum of $ 8,344.
Daily candles and line charts
Bitcoin outside bar created a bullish candlestick pattern on Monday (top left), which occurs when the day begins with a pessimistic note, but ends with optimism surrounding the previous day’s high and low.
Candle outside bar is widely regarded as an early sign of bullish reversal, especially when it appears at the bottom of a downward trend established or noticeable drop prices. In the case of BTC, the sail has appeared after a fall of $ 10,000 to $ 7715.
Also, histogram MACD, an indicator is used to identify changes trend strength and the trend has crossed above zero, confirming a bullish reversal.
Meanwhile, the line chart day (top right) is reporting an upward divergence relative strength index of 14 days (RSI).
A bullish divergence occurs when the RSI produces low higher, contradicting lower lows on the price chart. notice of an impending bullish movement is considered.
All-in-all, BTC looks set to challenge 1 October High $ 8,531 in the short term. A close above that level UTC invalidate the bearish pattern of lower highs, as tweeted by Josh Rager and confirm a break in the intraday chart, as shown below.
BTC is drawing a double bottom pattern with the neckline resistance at $ 8,531. Higher break confirm a break and make room for an increase of $ 9,348 (objective according to the method of moderate motion).
That said, the most credible evidence of a bullish reversal would rupture above the 200 day, currently lined $ 8586.
This is due to the fact that the 200-day MA is widely regarded as a barometer of long-term trend and served as a strong resistance on October 1.
For a $ 7,200 drop in prices strengthened if found acceptance within the 100 weeks MA at $ 7,756, as discussed yesterday, but from now that seems unlikely.
Disclosure: The author does not hold assets cryptocurrency at the time of writing.
Bitcoin image via CoinDeskArchives; charts by Trading View