Bitcoin rally continues for the twelfth consecutive day breaking above the 19,000 mark for the first time since November 8 2022.
Risk on sentiment pushed higher stocks and cryptocurrencies this week as investors bet that the Fed will slow the interest rate hikes especially after the inflation data released yesterday showed that the inflation is dropping at a fast pace. The annual Consumer Price Index (CPI) dropped to 6.5% in December from 7.1% the previous month. The US Core CPI, which cut out volatile food and energy prices, also dropped to 5.7% from 6% in November.
Bitcoin rally also helps the rest of the cryptocurrencies to move higher. Ethereum (ETHUSD) is trading 0.37% higher at $1421.80. Cardano (ADAUSD) is 0.66% higher at 0.331760. Binance Coin (BNBUSD) is 0.35% higher at $288.8. Dogecoin (DOGEUSD) is trading 0.37% higher at 0.0804.
Bitcoin Technical Analysis
Bitcoin is adding 1.94% at 19,223 which is the highest level since November 8. Strong bids over the last three days drove the number-one cryptocurrency by market capitalization above the 100-day moving average. The break above 7,888 (100-Day SMA) attracted more buyers as the momentum turned bullish.
The first resistance for bitcoin stands at $19510 the 200-day moving average. A break above would send clearly the ball to the bull’s court targeting the top from November 8 at $20,669.
On the downside, initial support stands at 18,720 the daily low. A break below might challenge the 100-day moving average at $17,887 which has now turned into a strong support area. If the bears manage to break the 100-day moving average then a test of the 50-day moving average at 16,995 can’t be ruled out.
All in all, the technical picture is bullish but traders should be very careful as the recent strong rally has moved bitcoin to extremely overbought levels as indicated by the RSI index which as of writing is at 83.20. Actually, the last time that bitcoin was at overbought levels was back on October 2021.
Nikolas has been involved in the finance industry for over fifteen years spanning across Europe and USA with a depth of knowledge and experience within many aspects of the financial markets. Nikolas gained several years experience with some of the Europe’s leading Brokers, as equity analyst, and trader managing accounts for both Private and Corporate Investors. He enjoys both the fundamental and technical aspects of trading focusing on stock markets and all FX majors. Currently, Nikolas provides analysis and comments to online financial publications. Educational background in Economics (BSc), and Finance (MSc).