Bitcoin BTC/USD was spiking up over 3.8% higher on Wednesday, crossing above the $17,000 mark after Fed Chair Jerome Powell began to speak at the Brookings Institution.
Powell suggested the central bank could begin easing back on its interest rate hikes starting as early as next month, causing the S&P 500 to jump about 2.8%. Bitcoin and Ethereum spiked in tandem.
Bitcoin’s jump higher confirmed the crypto is now trading in an uptrend pattern. The reversal into the uptrend was signaled on Nov. 21 and Nov. 22, when Bitcoin printed a double bottom pattern near $15,500, which Benzinga called out on Nov. 23.
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The Bitcoin Chart: Bitcoin negated its most recent downtrend on Monday by printing a higher low at the $15,992 mark. During Wednesday’s 24-hour trading session, the crypto shot up above the Nov. 24 high of $16,797, which confirmed a new uptrend.
- When Bitcoin printed its double bottom pattern, the crypto also developed exaggerated bullish divergence on the daily chart, which indicated bullish momentum was returning into the crypto. Exaggerated bullish divergence is created when a stock or crypto’s lows are flat but the relative strength index is making a series of higher lows.
- On Wednesday afternoon, Bitcoin was attempting to regain the 21-day exponential moving average (EMA) as support. If the crypto can pop up above the level and remain trading above it for a period of time, the eight-day EMA will eventually cross above the 21-day, which would be bullish.
- If Bitcoin closes the trading day near its high-of-day price, the crypto will print a bullish Marubozu candlestick, which could indicate higher prices will come on Thursday. If the crypto closes the trading session with a long upper wick, it could indicate the next temporary top is in and Bitcoin will retrace on Thursday.
- The next most likely scenario is that Bitcoin will form an inside bar to consolidate the spike higher. If that happens, the pattern leans bullish for continuation later in the week.
- Bitcoin has resistance above at $17,580 and $19,915 and support below at $16,000 and $15,000.
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