Bitcoin Analysis: Awaits bullish reversal confirmation

Bitcoin Analysis: Awaits bullish reversal confirmation


Heightened caution ahead of Chain-Split on July 21/Aug 1 saw investors move out of the Bitcoin space over the weekend. The BTC/USD suffered a head and shoulder breakdown on Friday and extended losses to $1758.20 – the lowest level since May 17. Bitcoin is currently trading above $2000. 

Technicals

Resistance

$2089 (5-DMA)
$2197 (38.2% Fib R of Apr 15 low – June 12 high)
$2250 (Oct 7 low)

Support

$1950 (50% Fib R of Apr 15 low – June 12 high)
$1909.58 (session low)
$1758.20 (previous day’s low)

Daily chart

Observations

Spinning bottom – Sunday’s candle
Head & Shoulders breakdown
RSI is turning higher from oversold territory
100-DMA is still sloping upwards

Commentary:

  • An end of the day close above the 100-DMA of $2053 today would add credence to Friday’s rounding bottom formation, oversold RSI could yield $2198-$2310 (head and shoulders neckline). 
  • On the downside, failure to hold above $1950 (50% Fib) if followed by a break below $1909 shall open doors for $1561 (Head and Shoulders breakdown target as per the measured height method). 
  • Caution is advised, even if Bitcoin confirms a bullish reversal as uncertainty ahead of the scaling issue could trigger panic selling. 



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