Bitcoin has continued its tremendous start to the year with a 9% rally over the past 24 hours to test the $8,400 level of resistance.
The world’s leading digital asset is now more than 21% up since January 2, with several analysts attributing the rally to mounting tensions between Iran and the United States following the death of top Iranian military general Qasem Soleimani.
Turbulence in the geopolitical landscape has the potential to destablise the US dollar, which in turn will drive the price of Bitcoin and gold to the upside.
From a technical standpoint, Bitcoin is well on its way to forming a bullish reversal. It closed yesterday’s daily candle above the 200 exponential moving average (EMA), which was a bitter point of resistance throughout September.
The next test for Bitcoin is the $8,400 level of resistance, while a break above that level would drive a continuation towards $8,830.
The daily relative strength index (RSI) is now at its highest point since June 27 when Bitcoin surged to $14,000, indicating that there may be more fuel in the tank to power an extended rally over the coming weeks.
The 22 and 50 EMAs have both started to tick to the upside following a two-month downswing, suggesting short-term momentum is on the rise.
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Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.