Bitcoin must see a sustained move above $8,750 to verify an end of the worth pullback from Sunday’s high near $9,200.
A strong move past that level will likely fuel a re-test of $9,200. that appears likely, with the longer duration charts flashing bullish signals.
A break below key support near $8,460 would open the door for a move to $8,200-$8,000.
Bitcoin’s bounce from key subsidy is struggling to collect traction.
The top cryptocurrency by market price made a reversal from levels near $8,461 (Sunday’s low) during Tuesday’s U.S. trading hours, rising to a high of $8,793 earlier today, consistent with CoinDesk’s Bitcoin price level .
The bulls have defended the $8,460 level multiple times since late on Sunday. Tuesday’s bounce was the third successful defense of the previous resistance-turned-support of the last 72 hours (bitcoin had dropped back at an equivalent level on Jan. 8).
This morning’s spike to $8,793 within the Asian trading hours was short-lived, and therefore the cryptocurrency is currently trading near $8,630. Similar price action has been seen within the last 48 hours.
Essentially, bitcoin is usually trapped within the $8,460-$8,750 trading range and only a sustained break above $8,750 would imply bull revival.
The range-bound trading is happening following a convincing downside breach of the ascending trendline over the weekend.
An hourly close below $8,461 would confirm range breakdown and signal a continuation of the pullback from $9,188, opening the door to support at $8,200 (horizontal line) and possibly to $8,000.
On the opposite hand, an hourly close above $8,750 would confirm an end of the pullback and will fuel an increase to recent highs near $9,200.
An upwards move looks the more likely path ahead, because the longer duration charts are reporting bullish conditions.
Daily and 4-hour charts
Bitcoin created a bullish outside-day candle on Tuesday, which occurs when prices close the day on a positive note, engulfing preceding day’s trading range. The candle is widely considered as an early warning of an impending bullish move.
Further, the upper lows on the 4-hour chart’s MACD are signaling a weakening of bearish momentum.
The weekly chart, too, is indicating the trail of least effort is to the upper side.
Disclosure: The author holds no cryptocurrency assets at the time of writing.