Bitcoin (BTC) price has traded in a narrow range in recent weeks, but the advance and trend reversed when the bullish eruption occurred after the announcement of Square allocating 1% of its cash reserves to BTC.
This bullish rally caused the price to spike from $ 10,600 to $ 11,500, which is close to $ 1,000 in a few days.
Despite this strong bullish trend, traders remain cautious as they are not sure whether the bullish momentum will return or if it is just a temporary rally.
Bitcoin daily chart is showing clear uptrend against resistance in the upper range. The deciding factor to watch is whether the resistance area of $ 12000-12400 has been breached, as this may indicate another impulsive wave approaching the horizon.
And while most investors expected a further drop, the opposite happened. There has been some negative news over the past week, but none of it has affected the bitcoin price.
However, the market started with a $ 50 million Square Ad. Soon after the news appeared, the triangle broke through the top and broke through the $ 11100 resistance area.
This led to a strong bullish reaction in the cryptocurrency markets. The most important step to look out for is a clear violation of the existing coverage limits structure, and this would happen if the price could rise above $ 12,000.
Such an outbreak appears unlikely in the short term as bitcoin price immediately approaches its resistance zone.
Range-based plots are likely early in a bullish session
The current moves can be compared to the start of the previous bullish cycle in early 2016.
Similar movements were observed at the start of the previous bullish cycle. This is before the appearance of the parabolic movements, by which the period can be defined as boring.
In 2015 and 2016, the six-month period was defined by the scope of the violation.
During these constructions, the former opponents were confirmed as support, after which a dull side period continued.
As you can see in the chart, the previous $ 10,000 resistance zone was tested for confirmation and that’s exactly what happened.
This confirmation led to a rebound, as in previous days. The critical breakout level for further upside momentum is the $ 12,000 resistance zone.
However, with the current build resembling the moves in 2016, it could take some time for a breakthrough.
So if a breakout occurs above $ 12,000, the bullish move against $ 17,000 is very close. The $ 17,000 area is the next major shift and the last hurdle before new full-time jobs emerge.
A highly likely scenario is the continuation of the finite-spaced movements discussed primarily in this article.
Hence, the upper resistance zone ranges between $ 12,000-12,400. It’s unlikely that there will be a breakdown right away, which means this is a re-test at lower table levels.
What is required to continue more? It is on the trend line but similar to the support level shown in the following chart.
It is essential to keep the upper green between $ 10,600 and $ 10,850. If this level continues and the scenario continues to develop from here, there will still be a fire in the beef market.
As previously discussed, a volcano eruption above $ 12,000 indicates significant bullish momentum and possible continuation to a new all-time high.