Bitcoin was able to form a bullish reversal candlestick on June 16, but was rejected today from $9,600, and it’s trading around $9,486 at press time.
It seems like there is a crucial contracting triangle forming with resistance near $9,750 on the daily chart of the BTC/USD pair. Therefore, the price must surpass that particular resistance zone to initiate a renewed increase.
The main hurdle is still near the $10,000 level, above which there are high chances of a steady rise towards the $10,500 level in the near-term.
If BTC struggles to clear the $9,750 level of resistance, there is a threat of a bearish break to the downside, with the next triangle support being near the $9,300 zone.
If prices break below this crucial support level, then BTC could start a fresh decline, with the first key support located near the $9,000 level.
Below this level, the price could prolong its decline to $8,250, where the bulls are expected to take a stand.
Bitcoin’s Correlation with U.S Stock Markets
Bitcoin rallied on Tuesday in sync with similar bullish moves in the US futures market, just as the US Federal Reserve unveiled plans to purchase corporate bonds to boost the financial markets.
This led some crypto observers to note that BTC and the US traditional stocks are essentially moving in the same trajectory. The correlation has been quite clear since June 15, according to Crypto enthusiast Ronnie Moas, who tweeted:
Indeed, shortly after the Federal Reserve’s rolled out strategies to boost stock markets, Futures tied to the S&P 500 rose 1.79%, while that of the Dow Jones rallied 2.31%. And as expected, BTC followed suit, surging by a whopping 7.8% in Tuesday trading.
Today’s downtrend to the $9490 level could indicate that investors are now awaiting the US stock market to open and direct them for the June 17 trading session’s bias.
What Next for Bitcoin?
Federal Reserve’s Chairman Jerome Powell is expected to appear before the US Congress on June 17 at 10 am EDT.
His unenthusiastic attitude towards the global economy in the wake of an expected 2nd Covid-19 wave could offset a share of optimism from the US traditional markets, causing BTC to dip lower as well.
That said, the top crypto is still targeting a surge to the $9,800 level as long as it can uphold a price floor above $9,500. This would then spark a prolonged bullish trend that could see BTC retesting the $10K resistance level.