The price of bitcoin has been trading below its 200 hour moving average since breaking on January 17. The low prices since the break bottomed on January 18 and January 19 near swing lows going back to January 9 and January 11.
Yesterday, the high price however stalled against its 100 hour moving average (blue line), 200 hour moving average (green line) and downward sloping trendline (see blue numbered circles). Those three technical levels prove to be a hard nut to crack. That led to further consolidation below those levels, before the digital currency was able to break above over the last few hours of trading.
The momentum on the buying has now taken the price above the trendline, 100 hour moving average, and more recently the 200 hour moving average at 42724.64.
The next target comes in at the high price from January 15 at $43,826.80. Above that and traders will start to target the 38.2% retracement and swing highs from January 12 and January 13 at $44,348.94 and $44,471 respectively.
What would now hurt the short term bias?
Moving back below the 200 hour moving average would definitely be a negative for the technical bias.
The buyers are making a play. The short term bias has improved above the aforementioned technical levels. The question is can the momentum continue? Is a bottom in place?
Taking a broader look at the daily chart below, the cycle low reached on January 10 bottomed near the corrective low going back to September 21, 2021.
The ability to hold that level, coupled with the break to the upside today on the hourly chart, helps to give traders more confidence that indeed a low might be in place.
There is more work to do of course, but given the double bottom seen this month, and the breakout today on the hourly chart, the picture is improving for the digital currency as long as the 200 hour moving average can now hold support.
