Our colleague Jennifer Mitchel, last Friday 26, had published an article commenting the volatility spike experienced by the BTCUSD pair on the news about stolen Bitfinex founds detected being moved after several years. This has been thoroughly discussed also in a Reddit thread.
This event drove the BTC price down by 10% in a couple of hours as we can see on the embedded chart.
After the Shock
But the price bounced back and kept moving up to fade all the downside movement during the coming days. So currently it is back at the levels previous to that shocking event. This is really good news. Bears couldn’t take control of the downside movement and take the opportunity to push it down even more. On the contrary, this dip was the chance many bulls had to purchase BTC at a discount.
The overall outlook is bullish. We see that the ascending trend line is supporting the price and there is no reason for the price not to travel up to its most resistance level around: the $6,400 level. Surpassing this level may take some time to accomplish, and it will be a good test for the strength of the bulls.
If you are long the pair, I’d set a profit target around the 6,400 area, close my position when touched by the price and, comfortably watch the action until it convincingly brokes above that level.
My invalidation level is the price’s confirmed breakdown of the upward trendline.
Below a panoramic view of the BTC price action, that shows why I say the $6,400 is a strong resistance to cross. We can observe also that the initial bullish trendline shows less slope than the one currently supporting the bullish price action. This is a sign the momentum on the BTC is growing.