Bitcoin Multiple Patterns to Create Bullish Springboard
I had for sure thought we would get a corrective wave over the weekend and it appears as thought there were a few attempts to break the support levels that had been cultivated over the past two week’s. However they were extremely short-lived and people used the strength to position their portfolio’s for the next alt coin run.
I had warned in previous posts that if price ends up going sideways for an extended period, we may not retrace back to the logarithmic downtrend line at all. I had thought that it really needed to happen to indicate a healthy, but given this extended strength we might not get a deep pullback at all.
Taking a look at the hourly linear Bitcoin chart on Bitfinex we have been following closely, there’s quite a few potential patterns.
After spiking down on Friday to the purple horizontal support line of $8,912, price rallied about $200 and then at about at 4am EST Saturday morning price was smacked down to a low of $8,750 and then rallied up to $9,500 in the span of about two minutes. The candle closed up at about $100 on the hour at $9,236 when there was about $750 of volatility.
I have no idea what whale would have caused the price to shift that much that quickly, but the Mt. Gox Trustees come to mind. After that, price bounced around in a range to where it now resides today at $9,230, almost exactly where that giant spinning top candle closed.
Anyway, I have a drawn a upward sloping channel between the black lines going back to Thurs the 26th, which price is currently at the bottom of and flirting with breaking to the downside. This appears as a bearish flag in a continuation pattern downward from the high back around $9,700
Additionally we have a symmetrical triangle as well if you take the bottom of that black line and the blue line that’s sloping downward and put them together. Price can break either way typically out of these formations, but usually continues in the same direction price was going before the pattern.
And as a bonus we also have a bullish flag on a shorter duration that’s been building since Saturday afternoon to today and naturally this has the look of something that could explode upward. So for now on the hourly everything appears neutral, but the longer this pattern moves sideways, the more likely price will continue to the upside.
RSI is narrowing in a symmetrical triangle as well that could break out by Wednesday or earlier. You can even see the 200 hour moving average coming up from the bottom there which has been providing steady support too.
On the daily linear Bitcoin chart of Bitfinex, I have removed the target to the downside for now, because you can see the indecision from the last few candles and no one wants to go bearish at this point.
You could make an argument that price already retested the logarithmic downtrend line on the linear chart, which I am not sure if that holds any validity, but you can see the wicks on Wednesday and Thursday last week retesting that maroon line. Was that the bounce of that resistance support line that we needed? Maybe.
The 55 day EMA also is about to cross under the 34 day EMA which would be a nice bullish sign at about $8,600, as worst if price does get crushed again that should provide support, however I don’t think that will happen.
RSI is still pretty high and the MACD looks like it’s curling down to cross over, but in previous bull markets with BTC that has not mattered either.
A close back above that .618 line on the long-term pitchfork at about $9500 would be a significant development for price to move higher and at this juncture a much more likely scenario.
I had warned in previous posts that if price ends up going sideways for an extended period, we may not retrace back to the logarithmic downtrend line at all. I had thought that it really needed to happen to indicate a healthy, but given this extended strength we might not get a deep pullback at all.
Taking a look at the hourly linear Bitcoin chart on Bitfinex we have been following closely, there’s quite a few potential patterns.
After spiking down on Friday to the purple horizontal support line of $8,912, price rallied about $200 and then at about at 4am EST Saturday morning price was smacked down to a low of $8,750 and then rallied up to $9,500 in the span of about two minutes. The candle closed up at about $100 on the hour at $9,236 when there was about $750 of volatility.
I have no idea what whale would have caused the price to shift that much that quickly, but the Mt. Gox Trustees come to mind. After that, price bounced around in a range to where it now resides today at $9,230, almost exactly where that giant spinning top candle closed.
Anyway, I have a drawn a upward sloping channel between the black lines going back to Thurs the 26th, which price is currently at the bottom of and flirting with breaking to the downside. This appears as a bearish flag in a continuation pattern downward from the high back around $9,700
Additionally we have a symmetrical triangle as well if you take the bottom of that black line and the blue line that’s sloping downward and put them together. Price can break either way typically out of these formations, but usually continues in the same direction price was going before the pattern.
And as a bonus we also have a bullish flag on a shorter duration that’s been building since Saturday afternoon to today and naturally this has the look of something that could explode upward. So for now on the hourly everything appears neutral, but the longer this pattern moves sideways, the more likely price will continue to the upside.
RSI is narrowing in a symmetrical triangle as well that could break out by Wednesday or earlier. You can even see the 200 hour moving average coming up from the bottom there which has been providing steady support too.
On the daily linear Bitcoin chart of Bitfinex, I have removed the target to the downside for now, because you can see the indecision from the last few candles and no one wants to go bearish at this point.
You could make an argument that price already retested the logarithmic downtrend line on the linear chart, which I am not sure if that holds any validity, but you can see the wicks on Wednesday and Thursday last week retesting that maroon line. Was that the bounce of that resistance support line that we needed? Maybe.
The 55 day EMA also is about to cross under the 34 day EMA which would be a nice bullish sign at about $8,600, as worst if price does get crushed again that should provide support, however I don’t think that will happen.
RSI is still pretty high and the MACD looks like it’s curling down to cross over, but in previous bull markets with BTC that has not mattered either.
A close back above that .618 line on the long-term pitchfork at about $9500 would be a significant development for price to move higher and at this juncture a much more likely scenario.
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