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Bitcoin has also formed a triangle chart template that may show a previous breakout as a preview for its inversion formation. The price is rebounded to the bottom of the triangle and may be due to a resistance test at the next $ 4,200 mark.
The 100 SMA is above the 200 long-term SMA to signal that the path of least resistance is on the upside. This suggests that the climb is more likely to gain traction rather than reverse. The price is traded above both moving averages, which suggests that these could continue to hold up as a dynamic support near the bottom of the triangle.
However, RSI is hitting the overbought area to suggest that buyers might be tired and willing to let sellers take over. Stochastic is aiming for the top but also plunging into the overbought region to signal the exhaustion. Turning down could mean an increase in selling pressure that could force a break of the triangle support around $ 3,900.
However, the fact that the bitcoin is closing above $ 4,000 may still be enough to attract buyers again. Recall that there is also a long-term reverse head and shoulders that are formed and a neckline over $ 4,400 could lead to a rally of the same height.
The optimism for institutional investments is what mostly keeps bitcoins afloat this year, even if traders still need to see more evidence of what actually affects volumes and assets. The optimistic forecasts for industry and prices are also encouraging, but they would soon take real developments to support any gain.
On the flipside, regulatory and taxation concerns were downs for price action in the previous year, along with the usual large number of security threats and uncertainties surrounding mining wars. Now that the latter has been resolved, however, operators can draw more attention to progress in space and how authorities are addressing issues.
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