Welcome friends, to this update analysis on Bitcoin! Let's get right to it. Looking at the four hour chart, you can see that BTC pulled back juuuust before reaching the neckline of the head and shoulders pattern. In the last analysis, I talked about how we could see an initial pullback, or some hesitation from the neckline, and that appears to have happened. However, BTC hasn't made contact with the neckline yet, so we will have to see how it reacts when it gets there.
Looking at the current price action, you can see that BTC appears to be funding support, on the 61.8% retrace, as it converges with the 20 EMA (in blue.) A test of the neckline resistance should occur soon, and then BTC will have to contend with resistance levels along the way. The first resistance level , above the neckline, will be at about 11788, followed by 12189, and then the heavy resistance at the 50% retrace, around 12750. A confirmation above the 12750 level will be extremely bullish , and it would be a productive move toward my upside target of 16500.
On the MACD , you can see that there has been a weak bearish crossover, and volume continues to fall, as traders step to the side and wait for the breakout. With that said, don't be so concerned with the volume here. We went to see some volume on a breakout above the neckline, but volume here isn't extremely important.
Overall, we're still waiting for the breakout, as BTC stair-steps higher on the 20 EMA . If an initial rejection causes BTC to turn lower from the neckline, I wouldn't get too concerned. It would be nice to see the 20 and 50 EMAs remain strong, but the breakout appears to be inevitable.
