Bitcoin price has been on a long-term low for a while now but it recently broke out of a descending trend line and is pulling back for a retest. The price is at a critical juncture and a bounce or break could determine the next long-term direction.
If these support levels stay intact, Bitcoin could bounce back to the swing high and resume the reversal. The 100 SMA has trumped the longer-term 200 SMA to show that the path of least resistance is to the upside. This suggests that the uptrend is more likely to resume than to reverse. However, the price has dropped below the longer-term 200 SMA as an early indicator that bearish momentum is kicking in. RSI is indicating oversold conditions, though, so a bounce may be in cards soon. Stochastic has already got themselves out of the oversold area to show that buyers are ready to return. A larger pullback to the broken trend line closer to the 61.8% Fib may be the last resort for the bulls because a break below this could lead to a drop to the swing low.
Bitcoin made a good start for the week but it is clear that the bulls were not able to keep up the momentum as investor worries continued. Steve Wozniak made remarks on how Bitcoin is the only digital gold but even his remarks didn’t help.
“All the others tend to give up some of the aspects of Bitcoin. For example, being totally decentralized and having no central control. That’s the first one they have to give up to try to have a business model.”
Dollar bulls are optimistic ahead of Trump and Kim Jong-Un’s meeting on June 12. Hence the dollar managed to recoup its losses in the latest US session, likely on the bounce in equities.
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