Bitcoin cracks major upside barrier in quest for $12,500

Bitcoin traded as high as $ 10,918 for the first time in weeks as bulls took control

Bitcoin could reclaim the crucial $ 11,500 price area in the short term if bulls maintain momentum above the key area, which has acted as a tough hurdle in recent weeks.

Yesterday, publicly-listed financial firm Square announced it had purchased $ 50 million worth of Bitcoin. In the hours that followed, the bellwether cryptocurrency added over 2.5% to its value to cross the $ 10,800 barrier.

In the process, BTC/USD broke above a symmetrical triangle pattern and is sitting well above the SMA50 to suggest the hidden bullish formation is strengthening.

According to veteran trader Peter Brandt, Square’s announcement is a “major development”, with social sentiment notably improved after a couple of weeks of a downcast outlook.

The highly-respected trader posted the chart below, noting that Bitcoin is “poised to flash a big buy signal,” on both the weekly and daily charts.

Chart suggesting Bitcoin is poised for a bull run. Source: Peter Brandt on Twitter

Although bulls failed to extend gains to $ 11,000, hitting an intraday high of $ 10,918 suggests the market is poised for a breakout.

BTC/USD price outlook

Looking at the daily chart, the height of the triangle suggests BTC/USD has its next target at around $ 12,500, the same level that formed the top of the last bull run from lows of $ 10,500 to highs of $ 12,486.

In the meantime, bulls face $ 11,700 as the next barrier according to IntoTheBlock’s IOMAP metric. There is a strong one million addresses barrier at this price level accounting for more than 740,000 bitcoins. Bulls will need to crack this wall to build momentum for the next high at $ 12,500.

To achieve this, buyers need to hold off sellers at the 50-day SMA that formed the barrier to the $ 10,918 high. As of writing, the bullish case is helped by the MACD and the RSI as seen on the daily chart.

BTC IOMAP support/resistance areas. Source: IntoTheBlock

On the flip side, the upside momentum will end if sellers seize control. However, even in this case, bulls have a solid wall of support at the SMA50, where the IOMAP indicates over two million addresses entered the market at $ 10,800. Beneath this level, the next major support is around $ 10,500 and the base of the long-term supply area at $ 10,000 provides dependable refuge.

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Bitcoin – Coin Journal

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