Bitcoin broke above the top of its symmetrical triangle visible on the 4-hour chart but the bullish move was quickly faded. This could offer a pullback opportunity for more buyers to join in the rally.
Price could make a retest of the broken triangle top around the $6,400 level or a deeper correction to the newly-forming ascending channel support around the bottom of the triangle or $6,200. A break below this area, however, could mean that the breakout was a false one and that bearish pressure remains.
The moving averages are still oscillating to reflect range-bound action and have yet to catch up to the spike higher. The 100 SMA could stay above the longer-term 200 SMA, though, indicating that the path of least resistance is to the upside. These moving averages might hold as dynamic support around $6,300 also.
Stochastic is still pointing down and has room to slide before reaching oversold levels, which means that bearish pressure could stay in play. RSI is just turning down from the overbought region to indicate that sellers are gaining the upper hand.
If the upside break is sustained, price could climb by the same height as the triangle, which spans $6,000 to $8,200. Similarly a move back below the triangle support could be followed by a selloff of the same size.
Bitcoin enjoyed a sharp surge on the Tether selloff as this value is negatively correlated to the digital asset. After all, this stablecoin whose value is tied to the dollar is used to buy digital currencies, so the selloff inspired quite the market panic.
Besides, Fidelity announced the launch of its institutional platform for bitcoin and ethereum, which could open up more volumes and increased activity for the cryptocurrencies. This might also be enough to sustain the uptrend and spur the highly-anticipated rebound before the end of the year.