Bitcoin is still trading inside its descending triangle pattern on the 4-hour time frame and is currently testing the resistance around $10,600. A break above this could spur a climb that’s around the same height as the chart formation.

This triangle spans $9,500 to around $13,500 so a bullish break could be followed by a rally of roughly $4,000. This should take bitcoin up to the $14,000-15,000 levels. On the other hand, a break below support could lead to a drop of the same height, taking bitcoin down to $5,000-5,500.

The 100 SMA is below the longer-term 200 SMA to indicate that the path of least resistance is to the downside. In other words, resistance is more likely to hold than to break. The 200 SMA is in line with the triangle top to add to its strength as a ceiling.

BTC/USD Chart – TradingView

RSI is turning lower after recently hitting the overbought zone, indicating that selling pressure is picking up. Stochastic is also starting to head south, so a pickup in bearish momentum may be in order.

Bitcoin bulls once again defended the bottom of the triangle and pushed price back above the key $10,000 mark, signaling that there could be more upside from here. However, it might need a big market catalyst to sustain the move, otherwise, it could turn out to be a fake-out.

One such catalyst might be the Bakkt launch later this week as the platform would start accepting deposits by September 6. The level of volumes could be indicative of the size of the market down the line, which would likely drive up demand for bitcoin.

Apart from that, fundamental factors also support more bitcoin gains. This includes the halvening next year, the pickup in risk aversion owing to geopolitical risks, and ongoing central bank easing.

Images courtesy of TradingView

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