Bitcoin has been gaining ground at a rapid rate over recent weeks, with XBT/USD rising 60% over the past nine days. To many, this has brought bitcoin back into the limelight, with claims that we have seen a bottom. With valuations across the cryptocurrency space heavily discounted, there are many who will see this recent sustained ascent as a buying signal, thus raising confidence that we could see sentiment recover after an extended period of uncertainty. However, the charts show that we may not be out the woods quite yet, with a break through key resistance required to negate the two-month downtrend.
Looking at the daily chart, there is a clear downtrend in place. However, with the recent rebound pushing bitcoin through the middle Bollinger band, we are seeing a challenge that has not been seen in over a month. It is also notable that we are seeing the stochastic moving towards a bullish divergence, with a push through 65 providing a higher high, to point towards the possibility of a break higher in the price.