Bitcoin has formed a golden cross (50DMA above 200DMA) on the D1 chart, highlighting bullish market sentiment.
The digital cryptocurrency has responded positively to the golden cross formation by avoiding a sustained move under $9,600 for the third consecutive day and rising back above $10,000.
Zooming in on the D1 chart shows the upward move has stalled around the 10DMA resistance of $10,078. As of writing, bitcoin its priced at $10,000 on Coinbase.
The outlook remains neutral with prices still trapped within the trading range of Sunday’s doji candle. From trading perspective, long exposure can be built if the cryptocurrency settles today above Sunday’s high of $10,048.
If prices fail to hold above the 5DMA at $9,982, the 1-hour chart support near $9,820 would be exposed. A violation there would invalidate the higher highs setup on the1-hour chart printed earlier today and bring back $9,600 on the radar.
Traders should note that a pullback from current levels would end up forming a head and shoulders pattern on the 4H chart.
The neckline support would be around $9,400, under which selling interest could strengthen significantly, leading to a significant price drop.
Head and shoulders, however, is not a holy grail and often traps sellers on the wrong side of the market if the broader trend is bullish, which seems to be the case here, as suggested by the golden crossover.