Bitcoin (CRYPTO: BTC) was blasting over 7% higher during Tuesday’s 24-hour trading session after soaring 23% between the low-of-day on Friday and Monday’s closing price.
The move saw the crypto trading at its highest price since June 2022.
BHero CEO Marius Grigora told Benzinga that institutional investors are continuing to enter the cryptocurrency space, which he expects will cause traditional financial markets to pay more attention to the impact of cryptocurrencies. Read more here…
From a technical analysis perspective, Bitcoin back-tested the 200-day simple moving average (SMA) on Friday and held above the area, which caused bullish traders to feel more confident that the apex crypto will continue trading in a bull cycle. This caused bullish momentum to enter into Bitcoin and several other cryptos including Ethereum.
Gold, which is considered the traditional safe-haven asset, is consolidating on Tuesday by printing an inside bar pattern. Bitcoin will eventually need to consolidate and print a higher low to confirm a new uptrend, and that is likely to happen soon because Bitcoin’s relative strength index (RSI) has reached 70%.
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The Bitcoin Chart: When a stock’s or crypto’s RSI reaches or exceeds the 70% mark it becomes overbought, which can be a sell signal for technical traders. Bullish traders want to see the crypto consolidate sideways or slightly lower, possibly forming a bull flag pattern on the daily chart.
- On Tuesday, Bitcoin looked to be forming an upper wick, which indicates there are sellers and profit takers near the psychologically important $26,000 level. In order to break above that area, Bitcoin may need to trade under the level for a few days, which would allow the crypto’s RSI to cool.
- Bitcoin’s eight-day exponential moving average (EMA) crossed above the 21-day EMA on Tuesday, which is bullish. The crypto’s eight-day and 21-day EMAs, as well as the 50-day SMA, are trending near the $23,000 mark and if Bitcoin retraces lower over the next few days, that area is likely to act as solid support.
- Bitcoin has resistance above at $28,690 and $31,418 and support below at $25,772 and $25,288.
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