Technical overview – Bitcoin Jumps 10% as Market Sentiment Shifts

• Bitcoin’s Recovery: Bitcoin has gained over 10% in the past week, with a rally starting over the weekend as the crypto community showed support for former President Donald Trump after an assassination attempt. As a pro-crypto candidate, Trump’s increased election odds have fueled positive sentiment toward Bitcoin and other cryptocurrencies, contrasting with Biden’s more cautious approach.

• Risk-On Sentiment: Bitcoin has regained key technical levels, and investors are reacting positively to recent news. Lower-than-expected US inflation data has increased the likelihood of multiple Federal Reserve rate cuts by the end of the year, further enhancing bullish sentiment in risk assets.

• Bullish Reversal: The recovery above $60,000, combined with the break of the downtrend trendline following oversold and divergence signals, indicate a strong bullish reversal for Bitcoin. This is further confirmed by the weekly candle that has recouped most of the previous week’s losses, signaling strong buying interest.

• Key Resistance Test: Despite the rally, the market is now facing a critical test at the $64,000 resistance level, which is marked by the July high and the upper boundary of the 45-day EMA channel, a commonly used trending indicator. Breaking and maintaining above this level will solidify the uptrend on the daily timeframe, aligning it with the weekly trend, and potentially setting the stage for another attempt at all-time highs.

• Key Support Level: The key support level continues to be outlined at $60,000, a critical marker of current sentiment. Staying above this level maintains the bullish outlook, while a break below could signal a potential reversal and prompt a retest of the recent lows.

BTC Daily Chart

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