Bitcoin price has been moving sideways during most of last week’s trading sessions, as the market’s bulls failed to push the market above the symmetrical triangle pattern that we spotted on the charts during last week’s bitcoin price analysis. Bitcoin price failed to breach the resistance around $6,757.5, which corresponds to the 23.6% Fibonacci retracement level, as candlesticks bounced off the upper border of the symmetrical triangle pattern.
Bitcoin price and the news:
Last week, bitcoin’s trading volume witnessed a significant drop. On October 6, according to data from Coinmarketcap, trading volume dropped from around $4 billion to $3.2 billion. This decline in bitcoin’s trading volume suggests that a significant rise in bitcoin price is not likely to take place during the upcoming 1-2 weeks. However, this is not in accordance with the positive regulation-related developments currently taking place in the US, South Korea, and Japan, which drove many technical analysts and observers to expect bitcoin price to exceed $9,000 before the end of the year.
A rising support level evident on the 4 hour BTCUSD chart:
We will examine the 4 hour BTCUSD chart from Bitfinex, while keeping the Fibonacci retracements we extended during last’s week’s bitcoin price analysis. We will also plot the Bollinger Bands and RSI indicator, as shown on the below chart. We can note the following:
– Last week’s trading sessions started by a downtrend that pulled bitcoin price down to record a week low of $6,424.6 last Wednesday. Right after the week low was recorded, bitcoin price started rising up to a week high of $6,741.4 on Friday. The market’s bulls failed to push price above $6,757.5 (23.6% Fibonacci retracement), which has been representing a strong resistance level resisting further advancement towards the North, since the beginning of September.
– A rising support level can now be spotted since September 17th (upwards sloping green trend line on the above chart). Since then, bitcoin price movements have been characterized by bullish waves followed by downwards price correction attempts. The peaks of the bullish waves have been almost always near the 23.6% Fibonacci retracement level ($6,757.5), which reflects how this level has been representing a strong resistance during the past 3-4 weeks.
– Currently, candlesticks are touching the lower Bollinger Band and the rising support level, so we can expect bitcoin price to start rising towards $6,700 during the first few days of the upcoming week. We can expect the resistance around 23.6% Fibonacci retracement to be retested some time during the upcoming week.
– The RSI indicator is around 40 at the moment, so chances are high that bitcoin price can rise, before the value of the RSI exceeds 70, reflecting an overbought market.
– As bitcoin price is now moving along a rising support level, we cannot expect the market’s bears to be able to pull price lower than $6,520. On the other hand, if the market’s bulls are successful in breaching the resistance around $6,757.5, we can expect bitcoin price to exceed $7,000 during the upcoming week, as the next significant resistance lies around $7,378.4, which corresponds to the 38.2% Fibonacci retracement.
– The 4 hour MACD is still bullish. The blue MACD line is still above the red signal line and both are sloping in an upwards direction. The MACD is in the positive territory. As such, the MACD indicator supports a bullish price move during the upcoming week.
– We can expect the bullish wave to be strong, if bitcoin’s trading volume rises again towards the levels of the beginning of last week. Usually, a strong upwards price movement is associated with a sharp rise in the trading volume.
After dropping down to a week low of $6,424.6 during the beginning of last week’s trading sessions, bitcoin price began rising, until a week high of $6,741.4 was recorded. The market’s bulls failed to breach the resistance around $6,7575.5, which corresponds to the 23.6% Fibonacci retracement, and has been representing a strong resistance level since the beginning of September. Our technical analysis predicts bitcoin price to continue moving along the newly spotted rising trend line, to exceed $6,700 sometime during the upcoming week. It is highly unlikely for bitcoin price to drop below $6,520 during the upcoming week, as predicted by analysis of the 4 hour BTCUSD chart.