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Bitcoin broke above a short-term descending trend line as an early indication that bulls are regaining control. Price is also starting to create a new ascending trend line on the 1-hour time frame.
However, the 100 SMA is below the longer-term 200 SMA to signal that the path of least resistance is to the downside. In other words, the selloff is more likely to resume than to reverse.
The gap between the moving averages is widening to signal strengthening selling pressure. Price is currently testing the 100 SMA dynamic inflection point at the moment and another break higher could draw more buyers in.
RSI Is turning down from overbought levels to reflect a return in selling pressure. Similarly stochastic is turning lower so price might follow suit. If the short-term ascending trend line keeps losses in check, price could still resume the climb.
Bitcoin was under pressure for the most part of the week due to the Coinrail hack and ongoing probe into price manipulation by US regulators and the Justice Department. However, it found a bit of reprieve when the dollar sold off after the FOMC decision as trade war jitters resurfaced.
Also, bitcoin got a boost from remarks made by a senior SEC official on how ethereum and bitcoin are not securities that must be regulated like stocks or bonds. In his speech during a San Francisco conference, SEC Corporation Finance Director William Hinman said:
Based on my understanding of the present state of ether, the Ethereum network and its decentralized structure, current offers and sales of ether are not securities transactions.
He also added that bitcoin isn’t a security in his view and cited:
Over time, there may be other sufficiently decentralized networks and systems where regulating the tokens or coins that function on them as securities may not be required.
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