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Bitcoin price survives weekend plunge but bulls remain strong above $11,000

Bitcoin price survives weekend plunge but bulls remain strong above
  • Bitcoin price survives a $1,500 plunge as weekend liquidations kick in
  • Short term traders book profit amid low volume over the weekend
  • Long term uptrend still in play and Bitcoin price flirts with $12,300 resistance

Bitcoin price - cryptocurrency heatmap

Cryptocurrency Daily Heatmap – by Coin360

The long-term uptrend remains in favor of bulls

As Bitcoin price rallies towards new highs, traders are looking at price action with new vigor. As the BTC/USD price flirts with a $12,000 mark, the trending move is sure to trigger the next leg of the rally for the king of cryptocurrency.

The otherwise dormant crypto trading has seen a new lease of life this past week as the $10,400 resistance zone has been broken confidently. What is vital is that the new wave is also fuelled by traders who missed buying into the now fired-up gold rally. Even though short-term traders may have booked profits as Bitcoin price touched $12,000, the long-term view is biased upwards.

Bitcoin price - BTC/USD hourly chart

BTC/USD Hourly Chart – by TradingView

The little drop in prices in recent hours is a result of sellers booking profit. However, buyers have sprung back into action and lapped up BTC/USD pair at lower prices.

Bitcoin price remains in a strong uptrend above $10,500 support

The move after July 27 breakout is still very much in action. The previous resistance in the $10,000-$10,400 zone has become strong support due to the swift buying action above this crucial level. Technically, it reflects an inverse head-and-shoulder pattern that targets $16,997 mark above.

The BTC/USD price now trades firmly above the 20-day exponential moving average. The average directional movement index (ADX) currently shows a reading beyond the 41 mark which shows a strong uptrend. Bulls are also encouraged by the positive directional indicator moving beyond the negative directional indicator.

bitcoin price - Tradingview analysis

Bitcoin Price Chart Analysis – at TradingView

As trader Alan Masters points out above that the short term trend is driven by the $1,500 plunge over the weekend. The recent reversal of price above the $10,500 level shows that the bulls are using the dip as an opportunity to buy. For now, the Bitcoin price is surely looking upward, and resistance at $12,300 is definitely within sight.

BTC/USD hourly chart shows bulls firmly in the driving seat

Several technical factors are displaying a healthy upward trend capable of carrying the buying action forward.  The 4-hour ADX currently rests above 44 levels. The RSI is also pointing upwards in 5-hour charts. The +DI pointed upwards is also a bad omen for the bears.

Now, the Bitcoin price is flirting with resistance at $12,300. This has also caused some profit-booking dragging the price below $11,000 level as short-term bulls leave the scene. As a result, the chart now sports a long outside day candlestick, which usually indicates a reversal. However, to reverse the current uptrend, the bears would have to bring the price under $10,400 mark.

The bears will have to bring down the price well below the $10,400 level in order to severely dent the price or change the trend downwards. Such a break underneath can have a severe impact not only on Bitcoin price but also on other altcoins. Till then, BTC/USD traders should not look for opportunities to short.

Surprise weekend plunge concerns short-term bulls

Massive liquidations in positions during weekends is common in the crypto market. The $1,500 plunge in Bitcoin price over the weekend raises many red flags. Since the number of active traders is very few during the weekend, the price tends to make wild moves. Lower volumes can cause huge price surges on either side.

On the positive side, the large liquidations have not caused the price to move below the support at $10,000. Thus, selling pressure is not likely to intensify. On the contrary, the buyers may well use this opportunity to accumulate more of BTC/USD pairs.

Disclaimer: The information provided is not trading advice but an informative analysis of the price movement. Cryptopolitan.com holds no liability towards any investments based on the information provided on this page.

Gurpreet Thind

Gurpreet Thind

Gurpreet Thind is pursuing Masters in Electrical Engineering at University of Ottawa. His scholarly interests include IT, computer languages and cryptocurrencies. With a special interest in blockchain powered architectures, he seeks to explore the societal impact of digital currencies as finance of the future. He is passionate about learning new languages, cultures and social media.

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