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Bitcoin (BTC) is currently trading at around $7,020. Looking at the chart, we can see that the largest virtual coin is in a continuous uptrend and broken the resistance at $6,150. Looking at 1 year data we see that the price has again hit the resistance but this time failed to break out.
There is formation of shooting star pattern at the resistance. Current resistance is at approximately $7,400 and support at $6,753.
According to Dow Theory, price is in the excess phase, which is an extension of the public participation phase. During this phase, negative sentiment starts to dissipate. As the good news starts to permeate the market, more and more investors move back in, sending the price higher.
This phase tends not only to be the longest lasting, but also the one with the largest price movement. It is also the phase in which most technical and trend traders start to take long positions. This phase is followed by the distribution phase, which is represented by the topping of the market where the price movement starts to flatten as selling pressure increases.
The price was moving between the channels with the middle average line acting as support. Recently, the price broke out from the channel and the momentum is negative. This indicates correction so we can expect the price to fall slightly before next upward rally.
When taking 9 period moving averages (blue) with 21 period moving averages (red), it indicates a positive trend with a bullish crossover as the price moving above the 9 period moving average.
Bitcoin is currently trading at $7,020 with resistance at the vicinity of $7,400 and support at $6,753. There is a formation of a cup pattern but no handle yet. with the current indicators we can expect the handle formation; the cup and handle pattern is a bullish pattern. However, the digital coin is currently stuck at the resistance level and we can expect a minor correction.
It is suggested not to take fresh positions at the current price; either wait for the price to break the resistance or settle. $6,882 can also be used as a buying point. According to both the Dow Theory and Bollinger Bands we can expect a minor correction. We can also expect the price to reach at least to $7,723 up to $7,942. Swing trading can also be done using the price points mentioned above. Overall outlook for the virtual coin is strongly bullish.