Bull Breather? Bitcoin Market Turns Indecisive at Two-Month High

Bull Breather? Bitcoin Market Turns Indecisive at Two-Month High 1

The bitcoin market is telling a tale of bullish exhaustion with indecisive price action following a rise to the highest point since November.

The top cryptocurrency witnessed two-way business on Wednesday. Prices rose from lows near $8,550 seen during the Asian trading hours to a two-month high of $8,903, only to end the day (UTC) on a flat note at $8,808, according to CoinDesk’s Bitcoin Price Index.

Essentially, bitcoin created a “doji” candle, which is widely considered a sign of indecision in the marketplace.

In this case, however, the candle could be considered a sign of buyer exhaustion, as it has appeared following a sharp rally from $6,850 to $8,900 and suggests the indecision is predominantly among the bulls.

The price action seen so far today is telling the same story. The cryptocurrency fell from $8,800 to $8,575 during the Asian trading hours and has struggled to chart a strong bounce ever since. This is in contrast to the quick reversals from sub-$8,600 levels seen in the previous two days.

At press time, bitcoin is trading near $8,600, representing a 1 percent drop on a 24-hour basis.

Bitcoin now risks a deeper pullback below Wednesday’s low of $8,555. A drop through that support would validate buyer exhaustion signaled by the doji candle (above left), attracting selling pressure.

It would also confirm a double-top breakdown on the hourly chart (above right). That would open the doors for $8,210 (target as per the measured move method).

That said, the short-term outlook would turn bearish only if any pullback ends up violating the bullish higher low of $7,667 created Jan. 10.

That, however, looks unlikely with the 5- and 10-day averages continuing to trend north. These averages, currently located at $8,508 and $8,276, respectively, tend to reverse pullbacks when they are on an upward trajectory. Further, the longer duration charts have recently turned bullish.

Wednesday’s high of $8,903 will likely come into play if prices violate the lower high of $8,705 seen on the hourly chart in the next few hours.

A break above $8,900, a level that has acted as strong resistance in the last 48 hours, would likely invite stronger buying pressure, yielding a quick move to the 200-day average at $9,100.

Disclosure: The author holds no cryptocurrency assets at the time of writing.

Disclosure Read More

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

Bull Breather? Bitcoin Market Turns Indecisive at Two-Month High 2
About the author

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bitcoin
Bitcoin (BTC) $ 44,733.00
ethereum
Ethereum (ETH) $ 3,142.31
cardano
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tether
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binance-coin
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xrp
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solana
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polkadot
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usd-coin
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dogecoin
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USD
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bitcoinBitcoin (BTC)
$ 44,733.00
ethereumEthereum (ETH)
$ 3,142.31
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$ 1.00
bitcoin-cashBitcoin Cash (BCH)
$ 549.53
litecoinLitecoin (LTC)
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bitcoinBitcoin (BTC)
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ethereumEthereum (ETH)
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tetherTether (USDT)
0,852697
bitcoin-cashBitcoin Cash (BCH)
468,58
litecoinLitecoin (LTC)
139,79
bitcoinBitcoin (BTC)
32,794.88
ethereumEthereum (ETH)
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tetherTether (USDT)
0.733125
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402.87
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CryptoCurrencyUSDChange 1hChange 24hChange 7d
Bitcoin44,878 0.02 % 3.27 % 6.87 %
Ethereum3,154.9 0.30 % 3.74 % 12.27 %
Cardano2.260 0.39 % 0.70 % 9.48 %
Tether0.9986 0.03 % 0.08 % 0.23 %
Binance Coin383.05 0.00 % 1.33 % 10.90 %
XRP0.9972 0.09 % 0.20 % 10.87 %
Solana149.01 0.40 % 0.36 % 6.05 %
Polkadot30.87 2.19 % 17.29 % 10.73 %
USD Coin1.000 0.13 % 0.54 % 0.38 %
Dogecoin0.2231 0.08 % 2.27 % 9.81 %

bitcoin
Bitcoin (BTC) $ 44,733.00
ethereum
Ethereum (ETH) $ 3,142.31
cardano
Cardano (ADA) $ 2.26
tether
Tether (USDT) $ 1.00
binance-coin
Binance Coin (BNB) $ 382.33
xrp
XRP (XRP) $ 0.996408
solana
Solana (SOL) $ 148.62
polkadot
Polkadot (DOT) $ 32.80
usd-coin
USD Coin (USDC) $ 1.00
dogecoin
Dogecoin (DOGE) $ 0.222885