Bitcoin still seems to be stuck inside its symmetrical triangle consolidation on the 4-hour chart but continues to climb inside a rising channel on the shorter-term time frames. Price is pulling back to the channel support and a bounce could take it up to the resistance.
The 100 SMA is below the longer-term 200 SMA, though, so the path of least resistance is to the downside. In other words, the selloff is more likely to resume than to reverse. Then again, the gap between the two is narrowing to signal that bearish pressure is slowing and that an upward crossover could be due.
In that case, bullish momentum could pick up and take price past the top of the channel and triangle around $6,800. Note that the triangle spans around $2,500 in height so the resulting uptrend could be of at least the same size.
Stochastic is pointing back up to indicate the return of bullish momentum without even seeing oversold conditions. RSI is treading sideways to signal consolidation but seems to be crawling slightly higher as well. If resistance holds, however, Bitcoin could slump back to the triangle bottom at $6,200.
Bitcoin has had a handful of positive reports propping it up last week, including news that Google will be reversing its ban on Bitcoin and ICO ads starting this month. Recall that the search engine platform banned these in order to protect consumers from potential fraud and will now be approving ads only from regulated entities targeting audiences in the US and Japan.
Also, the Bitmain IPO and reports that Coinbase is gearing up to add even more cryptocurrencies could be positive for the industry overall. This might be enough to keep Bitcoin on track for the much-anticipated rebound before the year comes to a close, as its market dominance has allowed it to take advantage of most of the volumes.
Rachel completed her degree in Mathematical Finance in 2009 and has since been involved in technical analysis of various markets, such as forex, commodities, and digital currencies.