Bitcoin Price: Strong Bounce at $6.5K Enough for a Bullish U-Turn?

Bitcoin closed the week down at $6,900 having lost around $1,400 or 18.72%. Monday got off to a disastrous start for the bulls, with a selloff in the Asian market session, losing another 5.5% finding lows of $6,500 before the bulls responded with a 13% swing back over $7,300.

Bitcoin failed to close the week above the 100-week moving average of $7,400, which has typically spelled trouble for the price of Bitcoin.

The 100 and 560-week moving averages are due to cross bullish next week and often price does reverse into moving average crosses, so it is not unusual price action being witnessed.

Price has ultimately found support at a previous highly traded volume node on the Volume Profile Visual Range, or VPVR, just below 65% of the retracement from the 2019 highs of 14K.The bounce has also come from around the same price point that saw a very strong reaction back in May 2019.The Moving Average Convergence Divergence indicator, or MACD, still implies that there is bearish momentum.

The daily chart is a little more useful in identifying the trend in the price of Bitcoin.

It is evident that Bitcoin has bounced off the same $6,500 level as occurred in May. But additionally, Bitcoin has apparently found support on the diagonal channel in which it has been trading for almost 5 months.

So there is a possibility that Bitcoin will need to do more business in the $6K price region.

Looking at the 4-hour bitcoin chart as an immediate guide for how the rest of the week may play out, it's clear that Bitcoin has run into some resistance at $7,400, in the vicinity of the 100 WMA.Breaking and closing the week above this level is the main task for the bulls this week.

SummaryOverall, the price of Bitcoin has again responded positively following a selloff.

For the bullish scenario to proceed, Bitcoin would need to regain the 100-week moving average at around $7.4K in the near future.