This week’s CPI announcement came as a huge relief to bitcoin investors, as lower inflation is likely to lead to an upside for risky assets. However, there is still room for caution from a technical analysis point of view, as the price has yet to break a major resistance level.
Written by: Idris
On the daily timeframe, the price finally reached the $18,000 resistance area and is currently trying to break it to the upside. The 50-day moving average, which is near the same price, is providing additional resistance for the time being.
It is important to note that an upward breach of this important resistance level could probably lead to an additional impulse towards the upper boundary of the main descending channel around the $20,000 mark.
On the other hand, if the price is rejected on the downside, a quick decline towards the $15,000 support area is likely, as there will be no hurdle for the price during this time frame.
4 hour chart
Looking at the 4 hours chart, the price finally broke above the $17k mark and is testing the $18k resistance. A breach of the mentioned level could pave the way for a rally towards $21,000 in the short term.
However, the RSI is already showing a red flag, as the indicator is deepening into the overbought territory, currently trending around 80%. This signal could indicate a bearish pullback or reversal in the coming days, which could lead to a possible retest of the $17,000 region.
Given the relatively high probability of the Fed rolling back interest rate increases and the recent bullish price momentum, a break above $18k would be the most likely outcome.
The overbought RSI signal should not be taken lightly, especially while the price is still trading below the mentioned resistance level at $18k.
Post-Bitcoin Value Soared To $18K But How High Can It Be? (BTC Price Analysis) appeared first on CryptoPotato.