Bitcoin is back above $10,000, but the technical charts indicate a bull revival is still $1,000 away.
The premier cryptocurrency by market value is currently trading at $10,150 on Bitstamp, having hit a low of $9,514 yesterday. This is the third time in a month that BTC has charted a quick recovery back into five figures.
Prices bounced off the former-resistance-turned support of $9,097 on July 17 and climbed back above $10,000 the following day. Before that, BTC printed a low of $9,614 on July 2 only to close well above $10,000 the same day.
On both occasions, BTC carved out lower highs – a bearish pattern – at $11,120 and $13,200, respectively.
The latest bounce may have caught some investors off guard, as BTC was on slippery grounds 24-hours ago after breaching long-term trendline support on Tuesday.
Despite the rise, the outlook remains bearish, as the lower-highs pattern is still intact. BTC needs to rally by $1,000 and beat resistance at $11,120 to invalidate lower highs and revive the bullish view.
That said, BTC may have a tough time rising above $11,120 as key resistances are currently capping upside.
BTC is struggling to rise above the resistance of the trendline connecting the July 10 and July 20 highs, currently at $10,200 (blue line above left). The bearish (downward sloping) 5- and 10-day moving averages (MAs) are also lined up near the trendline hurdle.
Also of note, the 5- and 10-day MAs have found acceptance below the 50-day MA – the first bearish crossover since early February.
Continued low trading volumes (above right) further question the sustainability of the recovery seen in the last 24 hours.
Hence, a fall back to $9,600 cannot be ruled out, unless BTC cuts through the descending trendline on the back of high volumes.
In that case, prices could rise toward $11,120, as the 14-day RSI is already reporting a falling wedge breakout (a bullish reversal pattern).
That said, the overall outlook would turn bullish only if prices print a UTC close above $11,120. A breakout above $11,120, if confirmed, would open the doors to $13,800 (June high).