Bitcoin Bulls Must Push Price Past $6.8K to Win Control

Bitcoin's price needs to pass last week's high of $6,810 to revive the prospects of a rally.

AccessTimeIconOct 22, 2018 at 11:00 a.m. UTC
Updated Sep 13, 2021 at 8:30 a.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now

Bitcoin (BTC) has flat-lined after creating a bullish pattern last week, and now only a move above $6,800 would put the bulls in a commanding position, according to technical charts.

Stepping back, the leading cryptocurrency clocked a four-week high of $6,810 on Coinbase last Monday before ending the week (Sunday's UTC close) at $6,415. Despite the pullback from the multi-week highs, BTC ended up 3.7 percent higher on the week.

The bull move last week saw the creation of what's called an inverted hammer candle. This is characterized by a long upper "shadow" (the difference between the weekly high of $6,810 and the weekly close of $6,415) and a small "body" (the spread between the weekly opening price of $6183 and the closing price of $6,415).

The inverted hammer is considered a sign of a bullish reversal if it occurs around the bottom of the downtrend and the upper shadow is two times the size of the candle's body. Further, the longer the upper shadow, the more likely it is that a reversal will occur.

In this case, the indicator appeared close to $6,000 – a level where the BTC has likely carved out a classic bottom. However, the upper shadow is only 1.7 times the real body, placing a bullish reversal in some doubt.

As a result, the immediate outlook remains neutral and only a move above $6,810 would confirm a bullish breakout.

At press time, BTC is changing hands at $6,400 on Coinbase.

Weekly Chart

coindesk_default_image.png

As seen in the above chart, the sell-off from the record high of $20,000 reached in December last year has likely run out of steam near $6,000.

A convincing move above $6,810 (last week's high) would validate the bullish inverted hammer and boost the prospects of a sustained move higher toward $7,402 (September high).

Daily Chart

btcusd-d

Over on the daily chart, price volatility, as represented by the spread between the high and low, fell to $47 yesterday – just above the 17-month low of $34 clocked on Oct. 13.

As a period of low volatility is often followed by a big move, we might expect some more vigorous trading action soon – possibly on the higher side, courtesy of the last week's bullish hammer candle. However, it's worth noting that bitcoin has been trading in a narrow range for months now and a promised sustained shift to either bulls or bears has so far not materialized.

View

  • $6,810 (high of last week's inverted hammer candle) is the level to beat for the bulls this week.
  • A break above $6,810 would raise prospects of a sustained move above $7,402 (September high).
  • On the downside, the 21-day exponential moving average (EMA) of $6,121 is acting as key support.

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

Bitcoin and fiat image via Shutterstock; charts by Trading View 

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.


Read more about