Bitcoin Bears Looking for A break Below 8,310
Bitcoin price is little changed as traders wait for the next catalyst. The BTCUSD is down by 0.42% and is trading at 11,861, which is a few points below the important resistance level of 12,000. Other digital currencies are also little changed, with Ethereum price up by 0.25% and Litecoin price up by 0.55%.
Bitcoin price has been in a strong upward trend in recent past. For one, the price has surged by more than 110% in the past three months. As such, it has outperformed other assets like gold and the S&P 500. Also, its volatility, as measured by the Average True Range (ATR) and historical volatility indicator has jumped significantly.
However, BTCUSD pair has been in consolidation mode in the past few days. For one, in the past five days, the price has remained slightly below $12,000.
This consolidation is possibly because of profit taking and the ongoing trends in the US dollar market. In the past few days, the US dollar index, which is a measure of how the USD is performing, has been in an upward trend as bulls aim for $94. The consolidation is also because of lack of a major catalyst in the crypto market.
So, what next for Bitcoin price?
The daily chart below shows that Bitcoin price has been in a holding pattern in the past few days. The price has simply struggled to move above the important resistance at $12,000. It remains above the 50-day and 100-day exponential moving averages. It is also above the ascending trend line that is shown in black. Most importantly, volume has been relatively stable but volatility has been falling.
In this consolidation, the price has formed what seems like a bullish pennant pattern. Therefore, I suspect that the price will break out higher in the near term. Any moves above $12,000 will mean that bulls have prevailed, which will push the price higher.
On the flip side, a move below $10,566 will invalidate this trend. This price is along the lowest swing on August 2.