After trading in a range that lasted for almost five weeks (300$-380$ price zone), bitcoin prices have made a run for it. The breakout above the ALMA weekly moving average (now at 380$) happened very quickly with high volume. Given the volume action of the last few days, another breakout above the $500 level at a first glance seems likely in the near future. The first decent resistance is the one year VWAP now at around $550 and it’ll be a true test to see if XBT/USD is still in a correction inside a long term bull market.
As i’ve said the weekly moving average i use is turning positive but i need to wait this and the next week to see if the reversal is genuine or not, the risk that we are just seeing a giant bull trap is not excluded; it might happen a repetition of may-june pattern where after an upmove of 250$ the market stalled and resumed the downtrend in July.
For the time being the possibility to reach a long term bottom at $220 by year-end is fading away, at this point i’ve to consider the recent bottom at $275 as an important one and again above the top of the previous cycle did at 266$.