Bitcoin breaking to the upside
Bitcoin has been in a downtrend for months now, and in recent weeks it's been range bound around the 16 – 17K zone. Yesterday, we had the CPI data from US come out, which gave bitcoin another push to the upside. It made a high just around 18K. This may be a significant turning point. Lets explore why.
Below you will see a snip of the daily chart on BTCUSD. If we draw a trendline from the swing high at 67,200 and connect the dots down, we can see it made the price push through this trendline for the first time, yesterday. Not only that, but the price also managed to stay above this trendline and close a daily candle above it. This is significant, as the more time we spend above this line, the more valid I believe this breakout will be.
So should you go all in just now? No. We do have FOMC Statement and Federal Funds Rate later today, which is likely to cause volatility and could potentially bring BTC back down below the trendline. With that being said, I do think there is a reason to expect higher prices on BTC in the nearest future.
If you take a look at the screenshot below, you can see the initial target I am looking at and why.
I expect we will see a push into the previous range, where the value is placed directly on top of the 2.618 fib. Extension. Just below it, we have a daily level at 21,295 and below that the 2.0 Fibonacci extension at 20,968. I expect we will see the 2.0 Fib. Extension being reached in the nearest future and very likely a move to the value area high as well, before another possible drop to the downside.