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Bitcoin formed higher lows and higher highs to create an ascending trend channel on its 1-hour time frame. Price is currently hovering around the middle of the channel, still deciding whether to continue the climb to the top or pull back to support.
The 100 SMA has crossed above the longer-term 200 SMA to confirm that the path of least resistance is to the upside. This suggests that the rally is more likely to resume than to reverse. In addition, the moving averages are close to the bottom of the channel to add to its strength as a floor.
However, RSI is already starting to turn lower to indicate that buyers are tired and may let sellers take over. Stochastic is also heading south so bitcoin price could follow suit.
Bitcoin appears to be on much better footing these days though, as it shrugged off news of Bithumb’s hack and the loss of millions’ worth of cryptocurrencies. This was a different reaction compared to the one for the hack of Coinrail, which is a smaller exchange wherein lesser-known altcoins were affected.
Perhaps the sentiment has improved overall thanks to indications that Tether might not have been used to manipulate bitcoin price last year. This eases some investor fears while US regulators conduct a probe into price manipulation practices among top altcoins.
Besides, investors are also getting hope from remarks by a senior SEC official who cited that ethereum and bitcoin shouldn’t be treated as securities that need to be regulated like stocks or bonds. Although this hardly represents an official ruling, it could be enough to convince other officials in the agency to lighten their stance on cryptocurrencies.
Meanwhile, the dollar could see more losses as trade tensions escalate. Although remarks from Fed head Powell reinforced tightening expectations yesterday, Beijing has threatened to respond with strong countermeasures if Trump pushes through with plans to slap tariffs on $200 billion worth of Chinese goods.
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