Bitcoin (BTC) Price Analysis: Bullish Correction Happening

Bitcoin has formed higher lows and higher highs to trade inside an ascending channel on its 1-hour chart. Price is currently testing the top of the channel, though, and might need a pullback to support in order to gain more bullish energy to sustain the climb.

Applying the Fibonacci retracement tool on the latest swing low and high shows that the 50% level lines up with the channel support around $6,700. This is also in line with a former short-term resistance, which might also hold as a floor moving forward.

The 100 SMA is above the longer-term 200 SMA to confirm that the path of least resistance is to the upside. This basically means that the uptrend is more likely to resume than to reverse. It also helps that the gap between the moving averages is widening to reflect strengthening bullish momentum.

The 100 SMA lines up with the 38.2% Fib around $6,800 which is also within the area of interest. The 200 SMA dynamic support is closer to the bottom of the channel and 61.8% Fib, which might be the line in the sand for a pullback. In other words, a break below this level could signal that a downtrend is due.

RSI is heading south so Bitcoin could follow suit while sellers remain in control. The oscillator has some room before hitting oversold levels, which suggests that bearish pressure could stay in play for a bit longer before buyers return.

Similarly stochastic is making its way down also to reflect the presence of selling pressure. Once both oscillators hit oversold levels to signal bearish exhaustion and turn higher, the bullish wave might resume.

Bitcoin is once again drawing support from speculations that the much-anticipated rebound until the end of the year is taking place. Many predict that Bitcoin could reach record levels or surpass those, especially if the SEC approves the Bitcoin ETF applications next month.

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