Going Up? Bitcoin Price Sets Sights on New Resistance

Bitcoin is working its way through the key supply zone above $7,500 and could test resistance at $7,870 in the next 24 hours, the technical charts indicate.

The bulls had a tough time absorbing supply around 50-candle moving average on the 4-hour chart, located yesterday at $7,550.

The repeated failure to beat the moving average hurdle ended in a downside break of the diamond pattern.

The subsequent sell-off ran out of steam at $7,270, and led to a convincing move above the 50-candle MA, seen today at $7,441.

As of writing, BTC is changing hands at $7,535 on Bitfinex, up 0.6 percent over 24 hours, and looks set to test the falling trendline resistance located at $7,870.

Only a weekly close above that level would signal bearish invalidation.

As seen in the chart above, the last weekly candle had closed below the 50-week MA for the first time since October 2015, in theory indicating the end of the long-term bull run.

Despite the bullish set up, there is merit in being cautious as the major moving averages - 50, 100 and 200 - on the 4-hour chart are also biased to the bears, as is the 10-day MA. View Bitcoin will likely soon rise to $7,870 in the next 24 hours.

A high-volume break above that level would allow a re-test of the 50-day moving average, currently located at $8,522.

Bearish scenario: The moving averages are maintaining a bearish bias, so a drop to $6,900 could be on the cards if the bulls fail to capitalize on the break above $7,500 and the price drops below $7,270 in the next 24 hours.