Bitcoin (BTC) bulls seem to be charging again at last day of the week. We have now seen the price test to 7400 level once again. While doing that, BTC/USD also managed to test the 200-exponential moving average on the 4-Hour time frame. It has now increased the probability of a rally towards $8,000 in the near future. The $7,183 level has proved to be a very strong support and until and unless there is a decisive break below this level, we have no reason to be bearish on the market near-term. However, as long as the remains below the 61.8% fit retracement level at $7,489 we have no reason to be overly bullish either. The EUR/USD forex pair had a very bullish weekly close and it is likely that Bitcoin (BTC) might be trying to catch up.

If Bitcoin (BTC) closes the day above the $7,000 level, this would be the fifth consecutive weekly close above the 100 weekly exponential moving average. There is no doubt that this would be a very bullish development for Bitcoin, one that could see the price easily test the $8k level. The RSI is trading at 62 whereas the Stochastic indicator is hovering around 88.88 indicating that we might have one last move to the upside left before the next downtrend begins. Should the price close below the $7,000 level which seems quite unlikely at this point we would be looking at a decline down to the next support at $6,882. Even if the price closes below the $7,183 level the bullish case would be lost and the near-term outlook of Bitcoin (BTC) will change. The price is currently sandwiched between the 200 moving average and the 200-exponential moving average on the 4H time frame.

Meanwhile Bitcoin dominance (BTC.D) has been showing signs of weakness. If it declines to test the support at 68.28%, it would mean a short-term bullish reversal in the cryptocurrency market in general and in the altcoin market in particular. Bitcoin dominance has still not tested the 200-day moving average. If it starts to decline this time, we could see it test the 200-day moving average as a strong support at the same time as it tests the 68.28% support. This would also be the perfect play that would liquidate a lot of retail bears looking to ride the price down and it would trap in more bulls that expect a major rally in the cryptocurrency market before the next halving.

A potential rally towards $8,000 is not only possible but it appears probable at this point. The fear and greed index is trading at the same level as yesterday which is 37, pointing to fear in the market. It is reasonable to expect that the market would need to become more optimistic and greedier before the next downturn begins. The conditions are ripe for such a play at this point. Now that we have not seen a sell-off before Christmas or the New Year, it is reasonable to think that a lot of retail bulls have become more confident to be long on the market. We just need one big move to the upside to turn that optimism and confidence into complacence. As enticing as it may seem to be bullish on the market before the next halving, we need to realize that the correction is not yet complete and Bitcoin (BTC) risks falling a lot lower before the end of this bear market.