By Omkar Godbole
- Bitcoin jumped more than 11 percent last week, confirming a falling channel breakout (bullish reversal) on the weekly chart.
- The breakout has opened the doors for a re-test of October highs above $10,000.
- For the next 24 hours, the focus is on $8,200, a level that has proved a tough nut to crack in the last few days. A strong rejection above $8,200 could yield a temporary drop to sub-$8,000 levels.
Bitcoin logged double-digit price gains last week, confirming a reversal from a six-month downtrend.
The top cryptocurrency by market cap gained 11.2 percent in the seven days to Jan. 12, the biggest weekly gain since October, according to CoinDesk’s Bitcoin Price Index.
Prices rallied by 16 percent in the third week of October. Since then, bitcoin has managed to score gains in just three weeks.
During the bleak six months to Dec. 31, the cryptocurrency eked out double-digit weekly gains just two times. Further, bitcoin suffered losses in 15 out of 27 weeks, with two weeks ending roughly flat.
Clearly, the bears were in control in the second half of 2019. Prices fell from highs above $13,000 to $6,425 during the period, establishing a series of lower highs and lower lows on the weekly chart.
That downward trajectory, however, has ended with last week’s 11 percent gain and the path of least resistance is now on the higher side.