Bitcoin (BTC) toll is currently in the process of a potent reversal, which has seen the digital asset quickly recover eight.xvi% to merchandise slightly above $7,200.

On Dec. 17 the digital asset bankrupt below the $6,800 back up level and swiftly commenced a tumble to the $6,450 support where it bounced of the lower support of the long-term descending channel.

Many analysts cautioned that if bulls failed to buy into the dip, a price drop below the $6,400 increased the possibility of a revisit to $v,500 to $v,350. Fortunately for bulls, the price bounced off the critical trendline and the digital nugget could at present be en road to flipping the $7,300 resistance back to support.

Cryptocurrency market daily overview. Source: Coin360

Is this a trend reversal?

BTC USD weekly chart. Source: TradingView

Earlier in the solar day, veteran commodities trader Peter Brandt tweeted a logarithmic nautical chart of Bitcoin'due south long term toll action and wrote:

"Bitcoin has manifestly held at of import support."

A number of other traders also pinpointed the importance of Bitcoin toll remaining above this support and today'due south strong upside move is sure to have relieved worried investors, at least for the time existence.

Interestingly, the rebound to $7,235 also filled the CME gap from Dec. fourteen-15, a miracle that has become increasingly common for BTC/USD this yr.

Bitcoin CME Futures chart. Source: Tradingview

Bitcoin turns bullish on the shorter time frame

BTC USD 4-60 minutes nautical chart. Source: TradingView

On the shorter time frame, 1 can meet that a powerful oversold bounce took place, flipping the moving average convergence divergence (MACD) histogram to positive and producing a strong balderdash cross between the MACD and the betoken line.

BTC USD 4-60 minutes MACD, RSI, Stoch chart. Source: TradingView

As suggested in the previous assay, the relative strength index (RSI) bounced around 20 and now extends into bullish territory to a higher place 61. The price likewise rose above the moving average of the Bollinger Bands and the indicator suggests that today'due south move could extend to $7,250 before becoming exhausted.

Bitcoin 1-day price nautical chart. Source: Coin360

Despite yesterday's carnage, the Bitfinex BTC/USD longs have over again continued to ascension college and it clear that many traders view the electric current prices as an opportunity to accumulate more Bitcoin and open long positions.

BTC/USD Longs daily chart. Source: TradingView

Meanwhile, Bakkt volume just bankrupt another all-fourth dimension high today with a daily trading volume of 5,690 BTC, which translates to approximately $39.eight meg.

The overall cryptocurrency marketplace cap was $191.vi billion at press time with many altcoins also enjoying salubrious five to 10% gains.

The views and opinions expressed here are solely those of the author (@HorusHughes) and practise non necessarily reverberate the views of Cointelegraph. Every investment and trading movement involves adventure. Yous should conduct your ain research when making a decision.