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Bitcoin finally breaks through $7,000 barrier

There were signs that bitcoin would surpass $7,000

Bitcoin (BTC) broke through the $7,000 level just after 10:00 UTC this morning finally breaking through the 20-day mostly sideways pattern. There were signs this could happen as bearish bitcoin bets hit a record low a sign that the mood was changing to a more bullish viewpoint.

The bad news last week that the Security Exchange Commission (SEC) had rejected 9 applications for bitcoin exchange traded funds (ETF) had a minor and temporary effect taking the price down sharply but briefly. The bears were not able to continue a downward trend.

CoinDesk analysis

A recent CoinDesk analysis of the bitcoin price was posted at 13:52 UTC August 28. At that time bitcoin was trading at $7,064 according to the CoinDesk Bitcoin Price Index. For the day up to then the high of bitcoin had been $7,070.

CoinDesk chart analysis

Bitcoin closed a 4-hour session above the resistance zone between $6,700 to $6,850. It was able to go on to ultimately pass the previous peak $6,899 that had been reached on August 22. The next resistance level is now at $7,165.

The price rise was able to go above the 200-period exponential moving average (EMA). The last time this happened was on August 4. That the price found acceptance above all of the short term EMAs shows the least resistance is to the upside at least in the short term.

However, a short term pullback as far as the prior resistance of $6,899 could be considered healthy. This would show that the price can hold above that.

The daily chart shows bullish trends that indicate a rise to around $7,600 is quite possible. BTC is defending its first higher low with the daily time frame since April. This is a strong bullish signal.

The 50-day and 100-day EMAs are forming a bull cross, a sign that the momentum is shifting to the bulls away from the bears. The strongest resistance on the daily time frame would be near $7,800 the location of the 200-day EMA and descending trendline resistance.

CoinDesk’s outlook

Based on its analysis the CoinDesk view is: “The short-term trend is becoming bullish, setting the stage for a move to the prior resistance zone of $7,400. Longer term, bitcoin setting a higher low is a bullish sign that could fuel a move towards the 200 day EMA at $7,800. Finding acceptance below prior resistance at $6,550 would negate the short-term bullish view.”

Present situation

Bitcoin opened today at $6,907 and had a low of $6,867. The high was $7,124. It is now August 29 UTC. BTC opened at $7,076. The high so far has been $7,084. A little more than two hours into the new day, the price was $7,073 just marginally below the open. It remains to be seen if the rally will continue but so far the bullish tendency seems to be prevailing. The present price of BTC can be found here,

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