In the short run, Bitcoin’s price is being squeezed in preparation for an upside breakout.
It’s reasonable to expect a retest of the double top at $36,709.
To be positive, BTC must continue over $33,000.
Profit-taking pressured the price of bitcoin Tuesday, as it did most other cryptocurrencies, after a strong gain over the weekend. BTC has already recovered most of its losses this morning, returning to profit levels seen on Sunday evening.
Since buyers poured in to push prices higher over the weekend, the Bitcoin price has been on a roller coaster ride for the past several days. BTC is back up near $34,865 after a complete retracement of its gains.
Bitcoin bounced off the climbing green trend line on June 22, confirming its strength, despite the hefty correction on Monday. The trend line was well respected, allowing buyers to re-enter the market.
Short sellers will be driven out of their positions and will remain on the sidelines until another entry point to go long becomes available. That level is expected to be around $36,709, a double top that hasn’t been broken since June 19.
Chart of BTC/USD on a daily basis
Bitcoin is forming a squeeze or perhaps a triangle pattern, with both likely to test the green ascending trend line or the double top at $36.709 in the coming days.
Buyers should be aware that the 55-day Simple Moving Average (SMA) stands just above the $36.709 level, putting a ceiling on Bitcoin’s upward movement. Short sellers will be seeking for this level to go short, and short-term purchasers will be looking to profit at this level./n
