Bitcoin price analysis for August 10-16: the coin has resumed its uptrend and is likely to rally to $13,000 in the short-term

The pennant breakout suggests resumption of the uptrend

The global stock markets, gold, and silver have been in a strong bull move for the past few weeks. Investors have been pouring money into assets because they fear that the incessant money printing is likely to debase the fiat currencies.

This rally in global stocks has pushed the Buffett Indicator, which calculates the stock market capitalization-to-GDP ratio, into bubble territory. This does not mean that the stock markets will start falling from tomorrow but it does warn that the market might be running ahead of itself.

Similarly, gold is looking like a crowded trade as it has been making new all-time highs in the past few days. Compared to these, Bitcoin’s price is still trading well below its all-time highs, which shows that it is undervalued. This has attracted several institutional investors into the crypto space, which suggests that they are gradually recognizing the potential of cryptocurrencies. 

Let’s do the Bitcoin price trend analysis of the weekly chart to ascertain the long-term trend.

Bitcoin price technical analysis: weekly chart

Bitcoin extended its rally last week and closed at $11,689.15, a gain of 5.58 per cent for the week. A breakout that picks up momentum as it moves up is a positive sign because it shows that traders are forced to buy at higher levels.

If the bulls can push the price and sustain above $12,137.90, the next leg of the up move is likely to start, which can carry the BTC to USD pair to $13,839.90 levels. The pair had turned down from this level in June, hence, the bears will again try to stall the rally at this level, which could result in a minor consolidation or correction. 

However, if the bulls do not give up much ground, the uptrend is likely to resume. A break above $13,839.90 is likely to attract frenzied buying from the traders who have been left out of this rally.

Anything can happen in trading. Hence, traders should also keep an eye on the level where this bullish assumption gets negated. If the pair turns down and breaks below the $10,552.95–$10,000 support zone, it will signal a likely change in trend that could result in panic selling by the bulls. 

The Bitcoin price weekly analysis shows that the bulls purchased the minor dip last week and are currently attempting to resume the uptrend. Let’s see if the BTC price analysis of the daily chart also suggests a further rally.

Bitcoin price technical analysis: daily chart

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Bitcoin had formed a pennant in the past few days, which generally acts as a continuation pattern. Today, the bulls have pushed the price above the pennant, which is a positive sign.

The bears might attempt to stall the rally at $12,137.90 but if this level is cleared, the next leg of the up move is likely to start.

There is a minor resistance at $12,312.60 but it is likely to be crossed. Above this level, the rally might extend to $13,187.15 where the bears might pose a challenge.

However, with both moving averages sloping up and the RSI close to the overbought zone, the advantage is clearly with the bulls. The first sign of weakness would be a breakdown and close (UTC time) below the 20-day EMA. Such a move could indicate that bears are attempting to make a comeback.

How to trade Bitcoin this week

After last week’s consolidation, the bulls are attempting to resume the uptrend. If the price sustains above $12,137.90, it could offer an opportunity for the traders to initiate long positions once again. 

One possible stop-loss for the short-term traders could be $11,300 as below this level, a drop to $11,000 is possible. This stop can be trailed higher as the price moves northward.

If Bitcoin fails to sustain above $12,137.90, a few more days of range-bound action is possible.  

FURTHER READING: Bitcoin explained simply: everything you need to know

FURTHER READING: Bitcoin vs Bitcoin Cash vs Bitcoin SV: the ultimate guide

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