BTCCNY could be in for a reversal from its previous uptrend as price broke below the ascending channel support on the 1-hour time frame. Price also moved below the moving averages, indicating that sellers are taking control. The 100 SMA is above the 200 SMA for now so buyers could still have a chance to allow the climb to resume. Price is now stalling at an area of interest around 4400.00, which held as resistance in the past.
RSI is turning higher to indicate that buying pressure could return. Stochastic is heading south but is nearing the oversold area, also suggesting that buyers could regain the upper hand. In that case, BTCCNY could pull up to the broken channel support for a retest before heading further south.
Improved Chinese fundamentals and an IMF upgrade on China’s growth forecast for this year are allowing investors to flock back to local assets, as fears of a slowdown have eased. The government has also reportedly reduced red tape on certain investments, encouraging a higher influx of funds.
Apart from all that, a return in risk appetite in financial markets has convinced several bitcoin traders to let go of their digital currency holdings to put more money in traditional assets like equities and currencies. Expectations of additional stimulus from a few major central banks could also shore up consumer and business activity in the near term, possibly leading to stronger market performance down the line.
With that, the trend could carry on for the next few days, barring any major changes in market sentiment. The European Central Bank has its monetary policy decision up next so volatility could still be seen for bitcoin. There are no major reports due from China, although changes in commodity prices could also influence BTCCNY price action.
