Bitcoin has spent the early part of the week moving back and forth across its 100- and 200-hour moving averages (they are near converged near $82,500). Each modest break above offered an opportunity for the buyers to take control. However, sellers prevailed. The price moved away from those moving averages and lower, but similarly to the buyers at the high resistance, sellers reached support and found momentum faded as well. And true to form, the price pushed higher.
Now the price is back at those converged moving averages near $82,500, putting traders at the same key crossroad at the 100 and 200 hour moving averages.
A week of missed opportunities
Bitcoin started the week above its 100-hour moving average and testing its higher 200-hour moving average—the green line on the chart below. Monday’s push briefly cleared that level, but the rally stalled at $84,178. Buyers could not keep the momentum going, and the price reversed below the 100-hour moving average toward swing support between $80,106 and $81,183.
After finding support in that area on Tuesday, buyers took another run to the upside. The rebound carried the price back above both moving averages, shifting the short-term bias in their favor. However, the rally failed to take out Monday’s high at $84,178.
The buyers had their shot. They could not finish the job.
That failure kept sellers in play and they pushed lower. On Wednesday, the price broke below the then-converged moving averages near $83,100, and downside momentum accelerated. By Thursday, bitcoin had fallen through the bottom of the $80,106–$81,183 swing area.
That should have opened the door for further selling. Instead, the break quickly ran out of steam, and the price snapped back above the support zone.
This time, the sellers had their shot. They missed.
Back at the moving-average crossroads
The recovery has now brought bitcoin back to its converged 100- and 200-hour moving averages near $82,500. Those levels are being tested today, and the next move needs follow-through.
For buyers, the job is to get above those moving averages—and stay above them. A sustained break would shift the short-term bias higher and put the following targets in play:
-
$84,178: Monday’s high and the ceiling buyers failed to clear earlier this week.
-
$85,578–$87,374: The higher resistance area containing the September and October cycle highs.
For sellers, the job is to keep a lid on the price at the moving averages. If they can do that and push the price lower, the focus returns to:
-
$81,183–$80,106: The swing support area that has been central to this week’s trading.
-
$76,052: The 38.2% retracement of the rally from the July low to the September high, if support gives way and sellers sustain the break.
The trading lesson: A break needs staying power
This week is a reminder that trading through a technical level is only the first step. What happens after the break matters.
Buyers moved above the moving averages but failed to clear the weekly high. Sellers broke below swing support but could not keep the price down. Both failures led to reversals.
Now bitcoin is back at the crossing. Get and stay above $82,500, and buyers have another opportunity to take control. Stay below, and sellers retain the advantage at resistance.
The levels define the risk. The follow-through will tell us who is taking control.
This article was written by Greg Michalowski at investinglive.com.