Bitcoin Breaks Downward Sloping Resistance Line

BTCUSD (Bitcoin) entered a rally mode on Tuesday, breaking above the resistance (now turned into support) barrier of $27,400, which coincides with the 23.6% Fibonacci retracement level of the September 2022 – April 2023 up leg. The rally also took the crypto above the downward sloping resistance line drawn from the peak of April 14, a move likely signaling the continuation of the prevailing uptrend, marked by the upside support line taken from the low of December 30.

The RSI and the MACD support the notion that Bitcoin may be poised to continue trading north for a while longer. The former is pointing up, approaching its 70 line, while the latter is lying above both its zero and trigger lines, pointing up as well.

If the bulls are willing to stay in the driver’s seat, they could extend their march and perhaps challenge the April 14 high of $31,160, the break of which could carry larger bullish implications, perhaps paving the way towards the $37,300 zone, marked by the inside swing low of May 1, 2022.

On the downside, the move signaling that the bears have stolen all the bulls’ weapons may be a dip below the $24,800 zone, which is slightly below the 38.2% Fibo level. Such a move will also confirm the break below the 200-day exponential moving average (EMA) and the break below the uptrend line drawn from the low of December 30. Any declines are likely to meet support at $21,400, but if that zone is not able to withstand the pressure either, the bears could then aim for the low of March 10 at $19,500.

To recap, Bitcoin emerged above the downward sloping resistance line drawn from the high of April 14, a break that probably signals the continuation of the prevailing uptrend, marked by the trendline taken from the low of December 30.