Bitcoin offers an opportunity for profit as it retraces before the breakout

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Bitcoin climbs another leg higher after breaking $ 50,000. Price action had been stuck in a distribution phase since August 20. The technical launch on September 5 is expected to herald more benefits to come.

The price of Bitcoin (BTC) is about to climb and could have a hit at the monthly R1 resistance level at $ 52,759.59. It comes after Bitcoin was in a phase of distribution between $ 47,065 on the downside and $ 50,019 on the upside. Between these barriers, buyers and sellers were able to pass price action on to each other. Buyers picked up BTC each time on August 26, 27, 31, and September 1.

The buyers have been smart enough to defend this level against the sellers pushing further down and, in the meantime, sit down and wait for their positions before the upside presents itself. This caused a surge and sent prices beyond $ 50,000 on September 2.

Taking a closer look at the daily price range, Bitcoin shows that sellers weren’t too keen to get stopped from their short positions whenever a price moved above $ 50,000 or tested $ 48,742. It was only after three days that the sellers withdrew and the buyers finally regained full control of the price trend.

Bitcoin will unlock more earnings

The next and first profit-taking port for Bitcoin will be the R1 monthly resistance level at $ 52,759. Expect short-term profit taking, but the recovery should mostly stay intact. The next and most crucial level is the test of this purple ascending trendline. This line has some historical significance, as Bitcoin shows since July 20.

Sellers, of course, will also have this ascending trendline on their bulletin board and once again try to take over from buyers. Expect price action to become volatile around those areas near $ 54,000.

BTC / USD daily chart

In the best case scenario where the buyers are in control, expect a breakout to the upside and a quick run to the R2 monthly resistance level near $ 58,000 or gains of around 12%.

If sellers can defend a breakout of the rising purple trendline, a quick dip to $ 50,019 will be the first move sellers make to make a quick profit. The risk could be that Bitcoin falls back into the range between $ 50,020 and $ 47,065.

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