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BTC/USD: Support Holding Firm
Weekly support at $25,381 has been a level of interest for the Research Team since price bumped heads with it in mid-August, following a rejection from weekly resistance overhead at $30,644. While rupturing this base unearths weekly support from $23,144, followed by another layer of support at $19,985, BTC/USD bulls went on the offensive last week, adding +2.6%. Adding to the possibility of further buying from here is the trend: we have been higher since bottoming in November at $15,460.
Meanwhile, price action on the daily timeframe reveals that the unit engulfed the 50-day simple moving average at $26,601 on Thursday and tested the mettle of a neighbouring resistance level at $27,221. Although a Death Cross emerged in September (that is, the 50-day simple moving average crossing below the 200-day simple moving average at $28,005, which suggests this market may be headed for a longer-term downward move), current resistance is an important base to watch this week.
A break north of here would help add technical steam to the possibility of additional outperformance, which could lead to price overthrowing the 200-day simple moving average to target daily resistance at $29,284. For those who trade using the Relative Strength Index (RSI), you will also note that the indicator is now above its 50.00 centreline (positive momentum) A move south, however, places a bold question mark on weekly support highlighted above at $25,381.
On the H1 timeframe, buyers and sellers ended the week squaring off at support from $26,742, following a reaction from resistance on the daily timeframe at $27,221. Assuming the H1 support holds firm, this bodes well for those anticipating a breakout above daily resistance this week; conversely, this would place those short from daily resistance in a tricky situation and may see many reduce risk to breakeven in the event of further signs of bullish activity from the H1 support.
Ultimately, with weekly price rebounding from support at $25,381 in a market still trending north, along with daily price manoeuvring above the 50-day simple moving average at $26,601 (and retesting the level in the form of dynamic support on Friday) and H1 price holding at support from $26,742, chart studies suggest bulls have the edge this week and we could see the unit nudge beyond daily resistance at $27,221.
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