A doji is forming today on the Bitcoin daily chart as price holds near recent highs. With price trading around $7500, the doji candle typically shows some indecision in the market but holding near highs is typically a good indicator for further upward movements. And the longer it trades in this range sideways, the more indication we have of a bull flag which could precede a further move to the upside.
The price managed to close above the 100EMA yesterday. With the 200EMA approaching the $7850 point, this area is expected to have a lot of trading activity as it is both a lower high and could potentially be a spot where larger traders look for liquidity to take short positions.
Trading on the four-hour chart shows some relatively tight sideways trading on low volume. This sideways trading in the range tends to be the case after such big directional moves as we have seen this week where Bitcoin jumped 10% in the space of just a few hours as reported previously.
The longer this sideways trading occurs, the more likely the bull flag pattern with movement to the upside becomes. However, with resistance occurring around the $7550-$7600, both an upside and a downside scenario should be considered.
In the case of movement to the downside, moving averages on the hourly are likely to act as support. We have seen the 50EMA acting as some support for price action recently, but in the case that it fails to hold, the 100EMA is trading at a reasonable level to be considered support.
- The longer the price action trades sideways, the more likelihood of there being a bull flag which could be followed by movement to the upside.
- If the price manages to close again above the 100EMA on the daily this is a bullish indicator.
- If the price holds near recent highs.
- Resistance occurring near the $7550 to $7600 level.
- 50EMA & 100EMA should act as some support if the price drops.
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Bull Flag Forming in the Bitcoin Markets – Doji Forming on the Daily was originally found on [blokt] – Blockchain, Bitcoin & Cryptocurrency News.