Bitcoin Clings on Above Key Support Amid Signs of Price Pullback

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  • Bitcoin suffered a rising wedge breakdown, or bearish reversal, on the hourly chart earlier today. The bearish view, however, has been neutralized by the quick bounce from the key support near $5,170.
  • Acceptance below $5,170 would confirm a head-and-shoulders breakdown on the hourly chart and open the doors to $5,000.
  • A close below $4,912 on Sunday would validate the previous week’s doji candle and allow a deeper price pullback.
  • Bitcoin could challenge the recent high above $5,450 if sellers again fail to keep prices below $5,200.

Bitcoin’s (BTC) three-day run of slight gains is showing signs of exhaustion on the short-term technical charts, yet strong support below $5,190 has meant a pullback has remained elusive – so far.

The leading cryptocurrency is currently trading largely unchanged on the day at $5,250 on Bitstamp, having gained 3.4, 0.6 and 0.9 percent on Tuesday, Wednesday, and Thursday, respectively.

The gains invalidated Monday’s bearish outside reversal candle, which had called for a deeper drop below $4,900. Further, price closed above the stiff resistance of the 100-candle moving average (three-day chart) yesterday, signaling a continuation of the rally from April 2 lows below $4,200.

That several long-term indicators have recently turned bullish seems to have strengthened bullish expectations.

This is evident from the fact that bitcoin has established new support just below $5,200 over the last 72 hours, despite persistent price-negative developments like bearish patterns and indicator divergences on the shorter-duration charts.

Hourly chart

On the hourly chart, BTC dived out of a rising wedge pattern at 01:00 UTC today, confirming a bearish reversal.

The follow-through to that bearish setup, however, has been bullish. As seen above, prices have bounced up from $5,180 and are currently looking to re-enter the rising wedge.

Notably, the $5,180–$5,170 range has put a floor under bitcoin’s price for the second time in…

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