Bitcoin [BTC] moved back and forth within a firmly established downward channel for more than seven months. Following a bounce off the $53.8K support level earlier in the current month, BTC has surged by almost 18%, aiming towards the upper limit of the channel.
The main query remains whether the bulls can exceed this resistance to trigger a breakout, or if they will yield to another downward trend.
Currently, BTC is being exchanged at approximately $63,446. Recent price movements have displayed a battle between buyers and sellers, with Bitcoin lingering near the edge of the established pattern.
Recovering from crucial support
It is noteworthy that the 20-day EMA recently crossed over the 200-day EMA, confirming a ‘golden cross’ on the daily chart. Past patterns of the primary digital asset demonstrate that following such a crossover, a continued upward movement usually follows.
A breakout above this level has the potential to pave the way for a persistent surge towards the $67,000 – $70,000 bracket.
Nevertheless, the price has not yet breached the upper boundary of the downward channel. Failure to break through may trigger a brief setback. A rejection at this point could result in a decline towards $60,000 or even $55,838.
The RSI was recorded at about 62.52 at the time of this analysis. It was positioned above the neutral 50 level, indicating a robust bullish stance, although it had not reached the overbought threshold. This indicates that there is still room for further gains if the bulls can uphold their momentum.
It is crucial to observe that the RSI has displayed higher peaks in conjunction with flatter peaks in price action, suggesting the potential for a bearish divergence with price.
Conversely, the MACD (Moving Average Convergence Divergence) indicator has reaffirmed the bullish trend, as the MACD line continues to remain above the signal line.
Derivatives Information Unveiled
The trading volume of BTC declined by 19.93% to $47.39B, reflecting modest daily activity. Similarly, open interest decreased by 0.58%, indicating hesitancy among traders to engage in new positions at the current levels.
Within the last 24 hours, the long/short ratio leaned slightly towards bearish territory at 0.9869, indicating a balanced sentiment with a slight inclination towards short positions.
Nonetheless, prominent traders on Binance displayed greater confidence in bullish outcomes, boasting a long/short ratio of 1.0172.
The ‘golden cross’ between the 20-day and 200-day EMAs hinted at bullish possibilities; however, traders are advised to await confirmation with a conclusive breach above the upper boundary of the downward channel.