Bitcoin price analysis for June 29-July 5: technicals point to a possible consolidation
The crypto is likely to remain volatile in a range for a few more days
The crypto community received a boost when rumours circulated that PayPal is likely to allow its users to buy or sell cryptocurrency directly. This rumour picked up steam as the fintech giant sought to hire crypto and blockchain experts. If this speculation turns out to be true, it will be a huge positive as it can take cryptocurrencies mainstream. However, there has been no confirmation from PayPal yet.
Meanwhile, Grayscale Investments has been purchasing Bitcoin at a record pace. Since the miner rewards halved, a total of 39,544 Bitcoins have been mined while Grayscale alone has purchased 53,588 Bitcoin, according to a tweet by crypto analyst Kevin Rooke.
This suggests that institutional money has started to flow into cryptocurrencies. Let’s do the Bitcoin price trend analysis to identify the critical levels to watch out for.
Bitcoin price technical analysis: weekly chart
Bitcoin formed an outside week candlestick pattern last week and closed with a marginal loss of 1.83 per cent to end the week at $9,116.70.
The price is currently stuck between the long-term resistance line of the symmetrical triangle and the moving averages.
The attempts by the bulls to resume the up move hit a wall at $9,796.6, just below the resistance line. This shows that the bears are aggressively defending this resistance.
Both moving averages are flat and the RSI is also flattening out. This suggests a balance between supply and demand. However, this tight range trading is unlikely to continue for long.
Soon, the BTC to USD pair is likely to break out of this tight range and start a trending move. On the upside, a breakout of the $10,000–$10,500 zone is likely to start a sustained up move. On the other hand, a break below $8,050.50 is likely to result in a sharp fall.
The Bitcoin price weekly analysis suggests that both bulls and bears are waiting for a trigger to start the next trending move. Let’s do the BTC price analysis of the daily chart to spot any tradeable setups.
Bitcoin price technical analysis: daily chart
Although Bitcoin broke above the moving averages and the $9,600 level, the bulls could not carry it to $10,000, which shows selling at higher levels.
First, the bulls were sent back from $10,420.55 on June 1, then the BTC to USD pair topped out at $10,013.20 on June 10, and on June 22, the turnaround happened at $9,796.60.
This shows that the bears are aggressively defending the overhead resistance levels and the pair has been making lower highs. However, it is not all in favour of the bears because the bulls have been holding their fort on the downside.
The bears have not been able to sustain the price below $9,000. On June 27, the dip to $8,813.60 was bought aggressively.
Both moving averages have flattened out and the RSI is just below the midpoint, which suggests a few more days of consolidation is likely. The next sustained trending move is likely to start after the price sustains above $10,500 or drops below $8,050.50.
How to trade Bitcoin this week
As breakouts are not witnessing follow up buying, traders can adopt a strategy to buy on dips to strong support levels and sell when the price reaches overhead resistances.
Purchases can be done on a drop closer to $8,362.45 or if this level breaks down, then traders can start accumulating closer to $8,100. However, instead of buying on the way down, it is better to wait for the price to bounce before turning positive.
On the upside, traders can keep booking partial profits at $9,796.60 and then at $10,000. If the price sustains above this resistance, traders can trail the stops higher and wait because if $10,500 gets taken out, a sharp up move is possible.
FURTHER READING: The best cryptocurrencies to invest in summer 2020