Bitcoin price rallied to rebound above $6,000 and to the highest level since its 50% record plunge last week amid coronavirus fears.
After rallying 21.6% to a new seven-day high at $6,375, Bitcoin (BTC) traders now seem intent on pushing the price higher to $7,200.
The digital asset has made an impressive 66% recovery since dropping to $3,775 on March 13, and the majority of altcoins are also notching double-digit gains. But how much longer can the current rally last?
Crypto market daily performance. Source: Coin360
After breaking above the pennant trendline at $5,600, Bitcoin formed a bullish three white soldiers candlestick pattern and traders pushed the price slightly above the $6,300 resistance to $6,375.
At the time of writing the price is trading in the $6,170 to $6,250 zone as traders attempt to hold this level in order to tackle $6,300. At this point, there are a few scenarios that could play out.
The current range could hold as support as the price consolidates here until an increase in momentum and volume push the price over $6,300 and $6,400. Alternatively, Bitcoin could lose the current range and drop to retest $5,900, $5,500 and $5,380.
As mentioned in the previous analysis, if bulls can flip the $6,300-$6,400 area to support, then traders could stomp toward $7,200, although previous price history shows $6,600 and $6,800 could be areas of resistance.
BTC USDT 1-hour chart. Source: TradingView
The shorter time frames suggest the price may need to pull back support before continuing higher but the daily chart shows the moving average convergence divergence on the verge of pulling above the signal line and the histogram is fast approaching 0. The relative strength index is also pulling up towards 40.
BTC USDT daily chart. Source: TradingView
Yesterday’s rally to $6,375 brought the price above the moving average (20-MA) of the Bollinger Band indicator and the absence of high volume nodes on the volume profile visible range suggests that above $6,375 the price could push to $7,200.
For the time being, traders should keep an eye on trading volume as the U.S. trading session for traditional markets opens on Friday and crypto traders log onto their accounts.
Bitcoin daily price chart. Source: Coin360
Similar to Bitcoin, many altcoins have held on to the double digits accomplished during the relief rally that occurred on March 19. XRP gained 11.11%, bringing the price to $0.16. Litecoin (LTC) rallied 13.67% to trade at $39.14, and Binance Coin (BNB) added 18.04%.
The overall cryptocurrency market cap now stands at $174.9 billion and Bitcoin’s dominance rate is 64.7%.