- The most recent pump has painted a bearish divergence on the 1h, 2h, and 4h RSI. - If Bitcoin dumps from here, or even from a little higher, this could indicate the possibility of the formation of a Bearish Ascending Triangle if the price retests the ascending support line.
Ascending Triangles are characterized by a series of higher lows but the same highs. The horizontal upper trendline will experience multiple efforts as price resistance. The shape of the Ascending Triangle is altered by the slope of the ascending support line which ‘converges’ or; is inclined toward, the upper resistance line. Ascending Triangles vary in their duration, but will have at least two swing highs and two swing lows in price.
This bearish continuation pattern has 3 phases:
1) Background: A Strong impulsive, thrusting action with a surge in volume & price establishes a clear picture of the controlling bearish trend direction. In our ascending triangle price pattern it is represented visually by a Pole. Deeper and more drama the better as the Pole is the Key to recognizing the potential for the continuation of the pattern. The Pole represents trend direction as well as its strength & often this pattern is initiated as a new breakdown in price from an established area & sellers are in control. 2) The second phase is a pause for consolidation of the action both in volume & price and is represented by the ascending triangle. 3) The pattern confirms as a bearish continuation pattern if the action creates a new bearish breakdown with a surge again from the bears in both volume & price.
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It seems like the bearish divergence on the RSI is playing out like I explained. If the price touches the ascending trendline, then it could definitely indicate the formation of a Bearish Ascending Triangle.