Bitcoin BTC/USD took off flying beginning at 1:20 p.m. EST Wednesday, surging up 6.26% between that time and 3:30 p.m. EST, when the crypto banged into resistance near the $24,200 mark.
In total, Bitcoin is trading up about 8.5% from Tuesday's closing price.
The apex crypto then started to consolidate under that resistance level with a series of inside bars on the five-minute chart.
On smaller time frames, Bitcoin may be forming a bull flag pattern under resistance in order to gather the strength to break higher.
On the daily chart, Bitcoin negated its most recent downtrend with the spike higher, by printing a higher high. Eventually, the crypto will need to retrace to print a higher low, which would then confirm a new uptrend.
Want direct analysis? Find me in the BZ Pro lounge! Click here for a free trial.
The Bitcoin Chart: 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 again during Thursday’s 24-hour trading session. If the crypto runs into sellers and closes the session with a significant upper wick, it could indicate lower prices are on the horizon, which could come in the form of an inside bar.
- A retracement is likely to take place because Bitcoin’s surge caused its relative strength index (RSI) to spike back up toward about 66%. When a stock’s or crypto’s RSI reaches or exceeds the 70% level, it becomes overbought, which can be a sell signal for technical traders.
- Technical traders may have seen higher prices on the horizon because when Bitcoin retraced between Feb. 2 and Feb. 13, the crypto bounced up from the 0.382 Fibonacci retracement level, which is healthy. Bullish traders and investors will want to see Bitcoin trade up toward the $25,000 level in the near future to avoid the crypto forming a bearish double top pattern at Feb. 2 high-of-day.
- Bitcoin has resistance above at $24,206 and $25,772 and support below at $22,729 and $21,313.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
