Bitcoin Price Knocks Out Key Resistance Level as Bulls Target $9,500
After spending the last few days battling to hold prices above the $9,000 resistance, Bitcoin (BTC) price made a strong move by surging to $9,395. The 3.65% move took place on a high volume surge but the price quickly pulled back to $9,126 before recovering to 9,370 at the time of writing.
With just 4 days and 16 hours left before the Bitcoin halving, investors will be closely watching to see if the top ranked crypto-asset on CoinMarketCap can push above the $9,500 resistance to reach $10,000.
Crypto market daily price chart. Source: Coin360
Bullish traders will look for Bitcoin to secure another close above $9,000 to lend support to the idea the resistance level has transformed to a support and the next step is to flip $9,200 from resistance to support.
BTC USDT daily chart. Source: TradingView
While the move to $9,395 was a positive step forward, the price remains below the long term descending trendline resistance at $9,400. A break above the $9,400 level would position Bitcoin price for a run at $9,600 and some analysts have called for a rally to $10,000.
Although the halving is fast approaching and retail investors are feeling increasingly bullish, one must remember that since crashing to $3,750 on March 13, Bitcoin price has increased by more than 145% and the current set up on the daily time frame is beginning to look toppish.
Furthermore, taking a birds-eye view of the daily or weekly chart, one will notice that $9,500 is a crucial level of resistance and support. Overcoming this level is expected to be a challenge but given Bitcoin’s proximity to the price, a high volume surge could knock it out.
BTC USDT daily chart. Source: TradingView
Assuming the price doesn’t immediately reject at this level, both $10,000 and the $10,300-$10,500 are levels Bitcoin has not been able to overcome since September 2019.
Given that the current run is looking overextended, traders will likely be looking to short right at each of these crucial resistance levels.
CME Bitcoin Futures COT Summary. Source: CME Group.com
Last Friday’s CME Bitcoin Futures Commitment of Traders (COT) report also shows that institutional investors have increased their short positions over the past few months.
As mentioned in previous analysis, Bitcoin is known to rally higher in situations where investor sentiment is strongly bullish, meaning the current overbought RSI, weak buy volume and generally overextended rally can all be irrelevant if FOMO is destined to kick in.
But FOMO aside, a rejection at $9,400-$9,500 should result in the price pulling back to the $8,825-$8,550 where there is a high volume VPVR node. Below the $8,850 support traders will look for entries around $8,400 and $7,800.
BTC USDT 4-hour chart. Source: TradingView
Currently the shorter term charts show Bitcoin price seeking to find support at the $9,200 level, although a retest of $9,000 to confirm this level as support is expected. As mentioned earlier, a drop to $8,800 is not catastrophic as the 20-MA and a well tested support aligned with a high volume VPVR node are both at $8,850.
For the short term, traders should keep an eye on trading volume and a break above the daily high at $9,380.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
