Bitcoin price analysis: Contracting triangle breakout lingers

The cryptocurrency market has recovered slightly adding at least $3 billion in the last 24 hours. The market capitalization has increased considerably from $123 billion to $125 billion at the time of writing. However, the same recovery is not seen in Bitcoin price and other larger cryptocurrencies. In fact, at the moment, Bitcoin is trading in the red with declines of 2.4% on the day.

As discussed yesterday, Bitcoin price continued to grind far from the resistance at $4,000. The declines continued yesterday with the downside touching $3,734. A bounce occurred but buyers lacked the momentum to sustain growth above $4,000. BTC/USD is trading at $3,815 with the initial resistance capping the gains at the 61.8% Fib level of the previous swing high of $4,000 and a swing low $3,517.55. The second resistance is at the simple moving averages; the 50 SMA limiting upward movement at $3,816.54 and the 100 SMA 3,99495 (1-hour range).

The impending break from the contracting triangle will place Bitcoin price on a recovery path above $4,000. Bitcoin needs to reclaim the position of above $4,400 in order to come out of the resistance range. The medium-term resistance at $5,000 is in sight, although recoil to this level will be an uphill task for the buyers.

A look at the chart shows that the path of movement without many hurdles is sideways. The MACD is holding tight to the mean line (0.0) and the relative strength index is changing direction upwards but still at 36 percent. If the buyers can defend the triangle support, they can then focus on the upside breakout heading to $4,000.