Bitcoin continues to hover close to the top of its triangle consolidation pattern visible on the 4-hour time frame as it attempts to break higher. This marks another day above the $4,000 mark which is a positive sign for bulls.
In addition, the 100 SMA is safely above the longer-term 200 SMA to confirm that the path of least resistance is to the upside. In other words, resistance is more likely to break than to hold or support is more likely to hold than to break. The 200 SMA dynamic support lines up with the triangle bottom at $4,000 to add to its strength as a floor.
A break past the triangle top around $4,200 could send Bitcoin higher by the same height as the chart formation. This spans $3,200 to around $4,400 so the resulting climb could be around $1,200. Similarly, a break below support could set off a slide of the same size.
RSI appears to be pointing up to signal the presence of bullish pressure. In that case, buyers might still be able to have more energy left to push for more gains. Stochastic is just pulling out of the oversold region also, indicating that bullish pressure is returning and that it could stay on until overbought conditions are seen.
Sentiment in the industry has been mostly positive over the past 24 hours as traders continue to look ahead to potential developments in the space. For one, the expectation that institutional investment is about to kick in is encouraging traders to hold on to long positions for fear of missing out a big break.
At the same time, the lack of negative news is also allowing bulls to defend support areas and even form higher lows. Still, traders are likely holding out for an actual major development that could spur a technical break and draw more long positioning.
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