Bitcoin / USD Technical Analysis: Bullish Breakout Intact
A short-term setback doesn't invalidate the recent rally, with support being found all the way to $4650
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- Bitcoin has a neutral short-term outlook, with the BTC / USD pair at risk of a deeper technical correction
- The BTC / USD pair’s medium-term outlook remains bullish, with the cryptocurrency recently hitting a fresh 2019 high
- The daily time frame is showing that critical support is found at the $4,650 level
Bitcoin / USD Short-term price analysis
Bitcoin has a neutral short-term trading bias, with the number one cryptocurrency now attempting to correct lower after recently spiking to a new 2019 trading high.
Bearish MACD and RSI price divergence is present on the four-hour time frame, with the bearish price divergence extending down toward the $4,800 levels.
The four-hour time frame is also showing that the BTC / USD pair has now slipped below trendline support, with the $4,950 level the strongest form of near-term support.
BTC / USD H4 Chart (Source: TradingView)
Pattern Watch
Traders should note that a bearish head and shoulders pattern could start to form on the four-hour time frame if the recent pullback gathers pace.
Relative Strength Index
The Relative Strength Index indicator on the mentioned time frame is also bearish, with negative RSI price divergence present.
MACD Indicator
The MACD indicator on the four-hour time frame is bearish, with negative MACD price divergence now present.
Bitcoin / USD Medium-term price analysis
Bitcoin remains bullish over the medium-term, with the number one cryptocurrency maintaining its upside bias above its 200-day moving average.
The daily time frame continues to highlight that the recent bullish breakout from the falling wedge pattern still remains intact. Technical support from the upper-trendline of the falling wedge pattern is now located close to the pair’s 200-day moving average, around the $4,650 level.
Technical indicators on the daily time frame are starting to correct from overbought conditions, although they still remain bullish.
BTC / USD Daily Chart (Source: TradingView)
Pattern Watch
Traders should expect the bullish medium-term bias toward the BTC / USD pair to continue while price trades above the falling wedge pattern.
Relative Strength Index
The Relative Strength Index is bullish on the daily time frame, although it is starting to correct lower.
MACD Indicator
The MACD indicator on the daily time frame is currently showing bearish MACD price divergence.
Conclusion
Bitcoin is at risk of staging a deeper near-term technical correction if price starts to hold below the important $5,100 level. The overall medium-term bullish bias toward the BTC / USD pair will remain intact while price trades above the $4,650 level.
The bullish breakout from the large falling wedge on the daily time frame still suggests that the number one cryptocurrency is likely to trade much higher.
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