- The completion of the right shoulder is expected to result in a sustainable uptrend.
- BTC/USD still has room for improvement despite the correction from the highs at $5,500.
Following the sudden slide yesterday, Bitcoin found support at $4,960 (on Coinbase) before reversing the trend above the critical $5,000 level. Bitcoin bulls, not ready to give up pulled the price above the 12-day Exponential Moving Average (EMA). The upside was, however, is capped below $5,050. The sideways trading that followed did not last long as the price broke above the 20-day EMA paving the way for more correction to the upside. BTC/USD brushed shoulders with $5,100 before retracing back to the current price at $5,077.
The inverted head-and-shoulders pattern
The 1-hour chart shows the formation of an inverted heads and shoulders pattern. The pattern is usually associated with a bullish reversal following a downtrend that has found support. The completion of the right shoulder is expected to result in a sustainable uptrend. In case, BTC/USD to correct to $5,200 (resistance congestion).
Meanwhile, the 12 EMA is offering support at $5,059.66. The up trending market will have more weight if the 12 EMA can cross above the 20 EMA. The moving average convergence divergence (MACD) in the same 1-hour range is moving north from the lows of -60.84 to the current level at -11.95. These indicators show that the market has a bullish bias in the short-term and buyers are gaining traction against the sellers.
The daily timeframe shows Bitcoin still trend upwards following the triangle breakout at the beginning of April. In fact, BTC/USD still has room for improvement despite the correction from the highs at $5,500. The 12 EMA is offering immediate support while the 20 EMA at $4,732.14 is playing catchup. The MACD has started trending lower but is still comfortable in the positive zone at +327.
Bitcoin Price – Key Technical Indicators:
12-day EMA: $5,000
20-day EMA: 4,732.14
MACD daily: +327
Support 1: $5,050
Support 2: $5,000
Support 3: $4,732.14
Resistance 1: $5,100
Resistance 2: $5,200
Resistance 3: $5,500
