The crypto market was recovering on Friday as major cryptocurrencies flashed green. The global crypto market capitalization was up 1.14% on the day to the current value of $1.05 trillion.
The recovery was led by Bitcoin, the largest cryptocurrency by market value which was trading at 426,240, up 2% on the day and 1.2% over the last seven days.
In the longer timeframe, Bitcoin price leaves little to be desired. The bears appear to have set camp in the market, prolonging a downtrend that began in July. As a result, the big crypto is trading in the red on the monthly and quarterly timeframes.
BTC’s market capitalization now stands at $510 billion, cementing its top position on the CoinMarketCap ranking. The latest jump in Bitcoin price has been seen as a relieving moment for the holders who have faced significant overhead pressure over the past few weeks.
Bitcoin’s Downtrend Still Intact
BTC price action has led to the appearance of a descending triangle pattern on the four-hour chart. This comes as a result of the price record a series of lower highs and relatively equal lows since Aug. 29.
The triangle’s horizontal line (x-axis) at $25,500 has been providing support to Bitcoin over this period. Note that a daily candlestick close below this would spell doom for the pioneer cryptocurrency. This would clear the path for a drop toward the technical target of the prevailing chart pattern at $23,360. This would represent an 11% decline from the current price.
BTC/USD Four-Hour Chart
Note that even though the technical formation shows that Bitcoin might still be at risk of further losses, the attempt to escape from the bearish triangle points to the determination by the bulls to kick-start a recovery.
The position of the Stochastic RSI at 94 in the overbought region as seen on the four-hour chart shows that the bulls are currently controlling the price. The Moving Average Convergence Divergence (MACD) indicator had just crossed the neutral line into the positive region. The call to buy Bitcoin from the MACD which was sent on Sep.6 is still in play, suggesting that the market conditions still favor the upside.
Moreover, the bellwether crypto was trading above all the major SMAs, suggesting that it sat on strong support on the downside. Increased buying from these zones would see the price rise above the triangle’s resistance line at $26,150.
This would confirm a bullish breakout from the prevailing chart pattern with the price rising toward the $28,000 psychological level. Bitcoin is likely to lead other cryptocurrencies in a bull run once it closes above the $30,000 mark toward the peak highs of around $69,000.