Bitcoin On Track For New Highs
by Bogdan Giulvezan
Since August 21, Bitcoin has been moving completely sideways, in a “one up – one down” pattern. Almost every bullish day was followed by a bearish one and vice-versa. In the “traditional” Forex market, this behavior is usually followed by a strong breakout and thus far, the crypto market seems to follow the same principles as the legacy market.
The direction of the potential breakout may depend on the fundamental factors and the overall vibe that surrounds the crypto market, which seems to be optimistic lately. Just recently, on September 1, cryptocurrencies became recognized under commercial law in the state of Texas. Two Texas House Bills officially came into effect, with one establishing a blockchain working group and the other modifying the Texas Uniform Commercial Code to classify cryptocurrencies under commercial law.
This brings more clarity regarding the legal rights and obligations of the parties involved in commercial transactions but also a legal frame for judges to settle disputes. And not to mention that it’s a positive development for cryptocurrencies in general, as it is yet another step towards mass adoption.
Most of the Top 10 cryptocurrencies are showing gains over the last 7 days, with Solana (SOL) leading the charge with a whopping 73.65% increase, currently trading at 143.65 against the US Dollar. Cardano’s ADA posted a new All-Time High at $3.09 and increased almost 13% over the last 7 days, while Ethereum is going strong, trading above $3,800, and adding almost 22% during the last week.
Technical Analysis – BTC/USD
Bitcoin has been sticking like glue to the $50,000 resistance for more than 10 days, and it is currently trading around $49,800, with a 5.30% gain over the last 7 days. It looks like we will see another attempt to break the $50K barrier but unless we see clear signs of strength, the pair may soon change direction.
In other words, a breakout above $50,000 resistance should be confirmed by other factors before we can deem it a true break. Large green candles, with increased volume, are a sign that the bulls are buying the breakout, and so is a bullish cross of the MACD (which is currently bearish).
The Relative Strength Index is on an overall descending path since the pair started ranging, but it is showing hidden bullish divergence. This type of divergence occurs when price is making a higher low, while the RSI is making a lower low, and suggests that price will soon resume upward movement.