Bitcoin has formed lower highs and higher lows to consolidate inside a symmetrical triangle on its 1-hour time frame. This is right around the middle of the descending channel seen on the same chart.
The 100 SMA is still below the longer-term 200 SMA to indicate that the path of least resistance is to the downside. However, the gap between the two is so narrow that there could still be a chance for a bullish crossover. If that happens, Bitcoin might break to the upside of the triangle and proceed to test the channel top around $3,650.
If the moving averages around the triangle top continue to hold as dynamic resistance levels, bitcoin might eventually close below the pattern’s support and head further south to the bottom of the channel at $3,350.
RSI is pointing up to suggest that there’s still some bullish pressure left. The oscillator has room to climb before hitting the overbought region, although it also seems ready to move sideways to reflect range-bound action.
Stochastic is also heading higher so the Bitcoin price might follow suit while buyers have some energy left. Sustained bullish momentum could take price past the channel top and onto an uptrend, but it would take a strong positive catalyst to spur that.
For now, it’s apparent that traders might keep the price in consolidation until the next big development comes out. The latest is that Fidelity is set to launch its institutional platform by March, and this may be one of the factors keeping bulls on the defensive.
Still, note that price is coming off a prolonged slide since late last year so there could still be some momentum going. Besides, sellers have had a stronger reaction compared to buyers as rallies and even upside breakouts haven’t gained much traction lately.
Images courtesy of TradingView