Bitcoin has been cruising higher over the past few weeks.
Is it due for another major pullback, or can it go for a break higher?
Here’s what we’re seeing on the 4-hour time frame:
Bitcoin (BTC/USD): 4-hour
Bitcoin (BTC/USD) 4-hour Chart Faster with TradingView
Bitcoin has been forming higher lows and higher highs inside an ascending channel that’s been holding since February this year.
Flip-flopping risk sentiment on account of constantly shifting geopolitical developments kept the OG crypto tossing and turning for the most part, though its latest rally appears to be backed strongly by market optimism.
Can it sustain its upside momentum from here?
BTC/USD is testing its channel top around R1 ($77,945) after briefly finding support at the pivot point ($74,264) on its way up.Remember that directional bias and volatility in BTC/USD are often driven by market sentiment. If you haven’t done your homework on bitcoin and the U.S. dollar, it’s time to check the economic calendar and stay updated on daily fundamental news.
Another pullback could test the 38.2% Fibonacci retracement level around $73,250 or the 50% Fib closer to the mid-channel area of interest and 100 SMA dynamic inflection point.
The 100 SMA is above the 200 SMA, suggesting that the uptrend is more likely to gain traction than to reverse. The 61.8% Fib that coincides with S1 ($70,118) and is near the key $70K level could be the line in the sand for a bullish pullback, as long red candlesticks closing below this region could mark the start of a downtrend.
Keep an eye out for a bounce off any of the support zones, as a surge in bullish pressure could take bitcoin back up to the swing high near the $78K barrier and beyond.
Whichever bias you end up trading, don’t forget to practice proper risk management and stay aware of top-tier catalysts that could influence overall market sentiment.
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Bitcoin is testing its channel resistance, with both pullback and breakout scenarios in play depending on how price reacts to the ceiling. But as any trader learns the hard way, even the best-looking setup can fall apart without the discipline to stick to the plan.
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