Bitcoin Price Analysis: Clocks 2.5-Month High After Invalidating Bear Divergence

Bitcoin firmed up and printed $9,430 in Asia – the highest level since November 7. The digital currency’s rebound from the American session low of $8,876 gathered momentum immediately after the bearish divergence of the 1H relative strength index was invalidated, as seen below.

1H chart

The RSI crossed the descending trend line, representing bearish divergence at 23:00 UTC. During the sixty minutes to 23:00 UTC, the cryptocurrency printed a small green candle – a result of the price rise from $9,036 to $9,165.

With the negative divergence invalidated, the bulls stepped in, as expected, pushing the digital currency higher from $9,133 to levels above $9,400.

The upward move seems to have stalled in the last few hours. As of writing, bitcoin is priced at $9,330.

D1 chart

The bulls have secured a daily close above the 200DMA for the fist time since October. That coupled with the breakout on the weekly chart suggests scope for rise to $10,000.

Potential pullbacks, due to overbought conditions on 1H and 4H charts, will likely be short-lived.

The bullish view would be aborted if prices close back below the 200DMA at $8,900.