After consolidating for a short period below $9000, Bitcoin has been able to breach above the range over the past 24-hours, and at the time of writing this article, the asset closing on a position above $9500. However, the rally might not sustain a strong position above resistance at $9300 according to analysis.
Bitcoin 1-hour chart
On analyzing Bitcoin’s 1-hour chart, it can be observed that the asset’s movement had given rise to a falling wedge pattern. The pattern started to take shape from 20th May, and higher lows were registered at $9600, $9300, and $9000 before Bitcoin positively breached the pattern with a bullish breakout on 27th May.
The breakout from the pattern allowed the asset to surge above $9000 and over the past-hour, BTC managed to breach resistance at $9300 as well. Considering the current momentum remains high over the next 24-48 hours, Bitcoin may possibly breach $9500 as well but positive consolidation above $9500 seems unlikely.
According to the VPVR indicator, the line of control at the moment remained at resistance $9700, with significant trading volume also witnessed at $9500.
Relative Strength Index or RSI identified the activity from the buyers as the buying pressure had pushed the indicator in the overbought zone, suggesting the asset was currently over-valued with respect to the market valuation.
Bitcoin 4-hour chart
Now, the 4-hour chart for Bitcoin presented better clarity for the asset’s short-term future. Although Bitcoin had crossed the $9300 mark, it is important for the asset maintained position above the resistance for at least 24-48 hours to sustain a strong bottom at a higher range.
The chart suggested that the resistance at $9300 had been testing 4 times since April 29th, and for a couple of times, the asset dropped right back under the range.
Considering the current market, the rally appears weak at the moment as the trading volume has declined since May 20th as well. The increase in price backed with decreasing trading volume is a sign of bearish divergence, hence it is likely Bitcoin will topple below $9300 over the next 24-48 hours.