Bitcoin markets rallied slightly during trading on Thursday as we continue to see a bit of an upward tilt. Recently, we have been consolidating and forming a significant ascending triangle, so of course it shows that there is still bullish pressure in this market. Beyond that, we have obviously made a move higher lately, in a market that quite frankly had been dead for quite some time. While there are many pundits out there that will try to discern why Bitcoin would suddenly be bullish, the reality is that it doesn’t matter. If prices going higher, that tells you exactly what direction you want to be trading in. Unfortunately, I know far too many people that weren’t listening to that same advice 15 months ago.
Below current price is the 200 day EMA pictured in blue, which is hovering just above the $5000 level. That of course offers a bit of technical support, but at the end of the day volume has picked up just a bit and that of course helps as well. If we can break above the $5500 level, we will continue to go towards the $6000 level not only based upon the ascending triangle, but also based upon historical price action on the way down. The $6000 level will be rather resistive, as it was previous support and therefore there will be a certain amount of “market memory” attached to that level.
To the downside, if we were to break down below the $5000 level I anticipate that will probably go looking towards the 50 day EMA which is pictured in red on the chart. That’s not necessarily going to be a selling opportunity, but more or less an opportunity to pick up Bitcoin on a pullback.