Bitcoin Forecast: after the Winklevoss ETF correction, BTC/USD out of overbought territory, buying opportunity?
- The BTC/USD enjoyed a second week of gains and made a necessary correction.
- The technical picture remains bullish on Bitcoin, and a channel is emerging.
- The Forecast Poll shows a clear bullish tendency but upside targets are limited.
A second consecutive week of gains sent Bitcoin to a peak of $8,480 at the time of writing. Optimism about regulation, institutional interest, and seasonality are part of the five reasons for Bitcoin's summer surge. The last boost to the upside came from the decision by Facebook and Google to soften their stance on cryptos.
After the spike higher, the BTC/USD consolidated and eventually dipped below $8,000. The US SEC rejected a request by the Winklevoss twins to start an ETF, and that triggered the latest slide. Nevertheless, other, newer applications are pending.
It is interesting to note that other major cryptocurrencies such as Ethereum and Ripple did not enjoy the same magnitude of rises. It seems like the growing interest by well-established bodies is centered on the granddaddy of digital coins.
What's next for Bitcoin?
BTC/USD Technical Analysis - Not overbought anymore
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The Relative Strength Index on the daily chart shows that the BTC/USD was in overbought territory earlier, with a level of above 70. The recent downturn leaves the RSI above 50 but below 70, implying further gains after a much-needed correction.
Momentum also remains positive and the digital coin trades above the 50-day Simple Moving Average. Bitcoin still to break above the 200-day SMA which stands at $8,556 at the time of writing but is trending lower. If the Bitcoin price breaks above this level, it would serve as a bullish sign. The cryptocurrency is currently in an uptrend channel that is still developing (black lines on the chart).
The three-month peak at $8,480 is the apparent resistance level, and it is closely followed by the 200-day SMA mentioned earlier. Further up, $8,886 capped the BTC/USD back in mid-May. The next notable line on the upside is only the round level of $10,000 which also held Bitcoin down in early May.
The fresh low of $7,836 is a line of support that is very closely followed by the high points seen in late May and early June. $7,200 was a stepping stone in early June and is another line of support. Lower, the mid-July trough of $6,068 is the next level to watch.
The Forecast Poll of experts shows a bullish tendency in the short and long-term and a mixed tendency in the shorter term. Comparing to the previous poll, the forecasts have been all upgraded with a notable bump up in the long-term.
Author
Yohay Elam
FXStreet
Yohay is in Forex since 2008 when he founded Forex Crunch, a blog crafted in his free time that turned into a fully-fledged currency website later sold to Finixio.
