Bitcoin trading in a narrow range above $6,700

Posted Jul 8, 2018 by Ken Hanly
BItcoin (BTC) is trading within a very limited range just over $6,700 and so far appears unable to break through key resistance levels to test the $7,000 level but there are still quite a few hours of trading for July 8th.
Illustration by Digital Journal
A CoinDesk article from July 6th updated at 11:51 UTC on July 7th notes that the BTC price is stuck within a $400 dollar range unable to penetrate beyond key resistance levels to test the $7,000 level. What direction a breakout takes could set the tone for the next price move of the currency.
The CoinDesk analysis
The lower end of the trading range has been $6,341 , a former resistance level turned support or a double bottom necklace, scaled back at the end of June. The upper end of the trading range is $6,754 the 23.6 percent Fibonacci replacement of the sell-off from $9,990 tp $5,755. It put the brakes on BTC's rally earlier in the week discussed in a recent Digital Journal article.
A convincing move above the $6,754 level would be a signal that the recent rally from the June 24 low of $5,755 was continuing and the doors would be open again to a test of the $7,000 level. This is indicated by a double bottom breakout and a bull flag breakout the happened earlier this week. However if prices find acceptance below the $6,341 level this would weaken the bullish case significantly.
Short duration charts though show it is likely that there will be a downside break of the trading pattern. When the article went to press the BTC price was $6,250 on Bitfinex a drop of one percent on a 24-hour basis. The short term chart shows a transition from a rising channel to a falling channel a change from a bullish to a bearish outlook. There are other sign of a bearish outlook as well including the fact that BTC is trading below its 50-hour and 100-hour moving average (MA). The 50-hour MA also risks falling the 100-hour MA during the next few hours which would be a bearish crossover.
The downside break of the day before's rising channel also confirms a bearish strength indicated by the relative strength index strengthening the case for the bears. The Bollinger Bands also have adopted a bearish status as they begin to fall.
The CoinDesk view based on the analysis
CoinDesk's outlook: "BTC risks falling below $6,341 (double bottom neckline - former resistance-turned-support, the lower end of the trading range) as indicated by the bearish setup on the hourly and 4-hour chart. Acceptance below $6,341 would abort the bullish view put forward by the double bottom breakout, bull flag breakout and bullish falling channel breakout and would shift risk in favor of a drop below $6,000. On the higher side, an aggressive move above the significant obstacle of $6,754 (23.6 percent Fibonacci resistance) would bolster the already bullish technical setup on the daily chart and open doors to $7,000. "
Present situation
Bitcoin opened Saturday at $6,597 but just before the day ended it jumped up considerably and ended up closing at $6,755 up considerably from its open. Today it has been trading in an extremely narrow range so far with a high of just $6,779 and a low of $6,714. The price has moved beyond the key $6,754 level but so far not convincingly so. At 17:30 UTC the price was just marginally below the high at $6,749. Perhaps BTC will break out to the upside in the next few hours. The present price of bitcoin can be found here.