Bitcoin - Double top may signal further pullback

Bitcoin is slightly lower on Thursday, having stalled in the middle of the week following strong rallies this month.

The 50 fib level – April highs to June lows – is putting up a bit of a fight as resistance, although I don’t think it will keep the crypto bulls at bay for much longer. This rally has some real momentum and I think we’re just seeing some brief profit taking.

We did see the momentum indicators ease around the 50 fib level on the 4-hour chart but this may just support the profit taking theory and lead to a brief pullback.

We’re not seeing it gather any momentum to the downside although, if it does edge lower, it could see support around $42,500, which is prior support and resistance and the 38.2 fib.

The double top of the 4-hour chart would support this also, with a break of the neckline around $44,640, giving a possible price projection around that 38.2 fib level.

A move through $47,000 will see attention shift to $50,000-51,000 region where past support and resistance combines with the 61.8 fib. The psychological factor could also come into play around these big levels.