Trading Bitcoin: Consolidation Continues

Consolidation Continues

Consolidation continues as Bitcoin retests resistance at $12k. On the 4 hour chart above, Bitcoin has negated the tentative descending triangle. Additionally, Bitcoin’s 4 hour RSI is subtly forming a bullish divergence which may help the bulls retest the previous high at roughly $14k.

Daily

On the daily chart above, Bitcoin is currently on a green 1. According to sequential theory, it is not wise to place a trade on a green or red 1. Moreover, it is favorable to wait until price gives you a green 2 closing above a green 1 for confirmation of a long trade. For a short trade, it is favorable to wait until price gives you a red 2 closing below the previous red 1. If price gives us a green 2 going above a green one which breaks resistance at $12k, then a long trade is in play.

Weekly

Currently, the sequential indicator is on a green 5 of 9 candle. The current sequential indicator is in a recycle period and as a result numbers are not displayed on the chart. Nevertheless, we can extrapolate Bitcoin’s sequential momentum which tells us there will be 4 more weeks of upside. From a weekly perspective, Bitcoin is still bullish.

Cryptocurrency News

On July 5th, a survey was released by Business Insider which concluded Gen Z is not likely to purchase cryptocurrency in the near future. Major takeaways from the survey:

1,884 Americans ages 13 to 21 were surveyed. However, the participants were asked how likely they were to buy cryptocurrency within the next six months. Furthermore, it’s safe to say 13 year-olds are probably not thinking about trading their lunch money for a Bitcoin retirement investment. Once these same individuals reach prime incoming earning years, their opinions regarding investing in cryptocurrency may be different.

In other news, volumes across localbitcoins.com have spiked to its highest level since November 2018.

Conclusion

Over the weekend, Bitcoin was close to falling into a descending triangle formation, however, this bearish continuation pattern has now been negated. If Bitcoin breaks above resistance at $12k and price gives us a green 2 closing above a green 1 on the daily chart, a long trade is in play. For now, Bitcoin still needs a confirmation break above resistance at $12k.