Bitcoin bulls are in tactical retreat, getting ready for another assault as BTC/USD keeps close to $7,400
|- Bitcoin is sidelined amid year-low volatility.
- The bears still control the long-term trend.
Bitcoin attempted to break above $7,400 handle on Tuesday but retreated to $7.373 by the time of writing. The digital coin No. 1 is mostly unchanged since the beginning of Wednesday, trading with 1.3% gains on a daily basis. While BTC is not a growth leader among top-10 cryptocurrencies, it remains the driving force behind altcoins movements.
It is worth noting that Bitcoin volatility dropped to 8.88%, which is the lowest levels of the year. Just to put it in perspective: the weekly Bitcoin volatility reached 74% after positive outcome of hearings in the US Senate at the beginning of February.
While Bitcoin broke above four-week high on Wednesday, experts warn traders against excessive optimism as the broader trend is still bearish.
“I can’t look away from the broader trend. We are seeing these intermittent rallies, but the broader movement is extremely consistent like the move to $8,500 [in late July], which didn’t last long,” said senior market analyst at Oanda Craig Erlam.
However, Erlam believes that the recovery is possible as long as the price stays above $6,000.
Bitcoin's technical picture
While BTC/USD bulls stopped short of 38.2% Fibo retracement at $7,400, the short-term trend remains positive as the coin stays above all critical SMA levels on the intraday interval. Once the above-said resistance is cleared, the upside may be extended towards sloping trendline from May 5 peak (currently at $7,660).
On the downside, The local support comes at $7,297 (SMA50, 1-hour), followed by $7,107 (SMA200, 1-hour and short-term upside trendline.
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