Bitcoin price rallied 5.5% to cross above the $7.6K resistance, briefly gaining above $8K and leading traders to call for a trend reversal.
On Monday during the U.S. evening trading session, Bitcoin (BTC) price continued its rally from $7,358 and at the time of writing the price pushed as high as $8,000. For the past week, traders have been closely watching to see if Bitcoin could flip $7,450 from a resistance to support and many suggested that sustained move above $7,600 would open the door for a shot at the $8,000 to $8,200 range.
The 4-hour close above $7,600 pulled the price above the 50-day moving average (MA) and provided bulls with enough confidence to push the Bitcoin to set a daily higher high not seen since Nov. 21 when the asset traded for $8,122.
Cryptocurrency market daily overview. Source: Coin360
Currently, Bitcoin price is closing in on the 200-day moving average (MA) and this point is also within $40 of the main trendline of the long-term descending channel which formed when Bitcoin topped out at $13,800 on Jun. 26.
Traders will be keeping a close eye on this zone as the price has experienced multiple rejections at the trendline. The volume profile visible range (VPVR) also shows a high volume node right at the descending trendline ($8,168), meaning traders could anticipate so push back at this level and book profits.
BTC USD Daily Relative Strength Index (RSI) chart. Source: TradingView
In the daily time frame, the relative (RSI) has reached 64.5 which is bullish territory but also close to the level where the indicator pulled back on Oct. 25, Aug. 8, Aug. 5 and July. 9.
BTC USD Perpetual Inverse Swap Contract daily chart. Source: TradingView
Earlier in the day crypto analyst Philip Swift tweeted the above daily chart and suggested that Bitcoin was reapproaching what he describes as the crucial 2-year moving average:
“Still a lot of the day to go for $BTC but on the 10th (!) attempt I think we are finally going to get the close above the 2yr MA.
Pump it! “
Bitcoin 1-day price chart. Source: Coin360
Traders will now watch to see if the digital asset can hold above $8,000 or a healthy pullback to $7,750 could be on the cards.
The overall cryptocurrency market cap was $211.4 billion and Bitcoin’s dominance rate has risen to 68%. A number of the altcoins have also followed Bitcoin’s price action to post 3% to 5% gains and the most notable altcoin of the day is XRP with a 12.13% gain.
