Despite the bearish chart setup, bitcoin rose to a six-day high on Monday, putting a corrective rally to $7,000 back on the map.
The $400 rally may have trapped a few bears on the wrong side of the market, given the pennant breakdown on the 4-hour chart had called for a drop to $6,000.
Yesterday's gravity-defying price action in BTC has boosted the odds of a rally to $7,024.
As seen in the chart above, the 4-hour candle crossed the upper Bollinger band in a convincing manner yesterday, signaling a bullish Bollinger band breakout.
The cryptocurrency has also found acceptance above the 50-candle moving average and the relative strength index is biased bullish.
The positive Bollinger band setup also validates the argument put forward by the bullish price-relative strength index divergence last week that the cryptocurrency has found a temporary low at around $6,100.
BTC closed above the 10-day MA yesterday, invalidating the immediate bearish outlook.
Thus, the probability that the corrective rally will gather traction is high.
View BTC looks set to take out immediate resistance at $6,736 and rally towards $7,024.
A daily close above that level would open the doors to $7,500-$7,600, although the rally could be short-lived as the long-run technicals are still biased to the bears.
$7,000? Bitcoin Looks North After Six-Day High
Published on Jun 19, 2018
by Coindesk | Published on Coinage
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