Bitcoin is having a tough time scaling a key moving average hurdle that has kept the bulls in check for four weeks straight.

The obstacle that is proving so hard to beat is the 10-week exponential moving average (EMA), which stalled a rally attempt from around $6,100 in mid-September.

Since then, BTC has notably failed to produce a weekly close (Sunday's close as per UTC) above the EMA, establishing it as a crucial level to beat for the bulls.

At press time, BTC is trading at $6,580 on Bitfinex, having clocked a weekly high of $6,730 on Monday. The 10-week EMA, meanwhile, is flatlined at $6,698.

The retreat in the last three days indicates that BTC has failed yet again to leap the EMA hurdle, weakening the odds of further gains toward $7,000.

Weekly chart

CoinDesk - Unknown

As seen in the chart above, the 10-week EMA has been firmly capping bitcoin prices for a month.

On Monday, BTC crossed the trendline sloping downwards from July highs, confirming a bullish breakout. While one would have expected the price to now be well above the 10-week EMA hurdle, the EMA hurdle is, in fact, still intact.

The rejection at the 10-week EMA despite the upside break on Monday may now embolden the bears.

View

  • BTC's failure to keep gains above the 10-week EMA despite the trendline breakout has boosted the odds of a drop to $6,424 (last week's doji candle low).
  • A violation there would open up downside toward the psychological resistance of $6,000.
  • A convincing break above the 10-week EMA of $6,698 would signal a continuation of the rally from the September low of $6,100 and would open up upside toward September highs above $7,400.

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

Bitcoin 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.

The leader in news and information on cryptocurrency, digital assets and the future of money, 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. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.