After just a week and a half of consolidation, Bitcoin already looks primed for another move up.
Looking at the chart, we can see the possible formation of an inverse head & shoulders pattern. Often these patterns are identified as reversal patterns however they may exist as continuation patterns as well.
Of course you should always wait for confirmation before trading off this pattern and in this case it is when the candle body breaks and closes above the neckline.
Ideally, we are looking for a break of $12k to see another bull rally.
When we look at the volume during this correction down, we see a drop-off in sellers currently present in the market.
Considering the price has already made a 30% correction down, there is a good chance the correction is already over with especially when you look back at other bull market retracements for comparison.
The RSI and MACD are both showing positive upward movement despite price continuing to make lower highs.
With volume contracting and price struggling to dip any lower, seeing a positive momentum shift on these indicators is a good sign that there is accumulation going on.
Taking a look at the 1hr chart we are also see some strong divergences on both RSI and MACD seen here:
This rounding bottom looks good but we need price to break that black trend line above which is also about where the neckline for the inverse H&S lies.
Lastly, we can see a big surge in Tether supply over the last few days.
The last time we saw tether supply moving up after some hesitation, Bitcoin eventually broke out again and went on to rally higher once again.
charts.cointrader.pro/snapshot/DRkTK
If this inverse H&S pattern succeeds, the target for its measured move is at $14,300.
Thanks for taking the time to read my analysis and if you found this idea useful, please give it a thumbs up!
Looking at the chart, we can see the possible formation of an inverse head & shoulders pattern. Often these patterns are identified as reversal patterns however they may exist as continuation patterns as well.
Of course you should always wait for confirmation before trading off this pattern and in this case it is when the candle body breaks and closes above the neckline.
Ideally, we are looking for a break of $12k to see another bull rally.
When we look at the volume during this correction down, we see a drop-off in sellers currently present in the market.
Considering the price has already made a 30% correction down, there is a good chance the correction is already over with especially when you look back at other bull market retracements for comparison.
The RSI and MACD are both showing positive upward movement despite price continuing to make lower highs.
With volume contracting and price struggling to dip any lower, seeing a positive momentum shift on these indicators is a good sign that there is accumulation going on.
Taking a look at the 1hr chart we are also see some strong divergences on both RSI and MACD seen here:
Lastly, we can see a big surge in Tether supply over the last few days.
The last time we saw tether supply moving up after some hesitation, Bitcoin eventually broke out again and went on to rally higher once again.
charts.cointrader.pro/snapshot/DRkTK
If this inverse H&S pattern succeeds, the target for its measured move is at $14,300.
Thanks for taking the time to read my analysis and if you found this idea useful, please give it a thumbs up!
Comment:
Also, not sure how important this trend line is but it seems like its still relevant throughout this correction as it is now acting as diagonal support after serving as resistance since the start of the 2019 bull run
Comment:
Looks like Bitcoin wants to make a move any moment now. The right shoulder of this possible inverse H&S pattern has extended a bit. But the more important thing to note is buying volume breaking out on the descending black trend line below. Could this be the first sign of a breakout coming? Also taking a look at the rising blue trend line drawn on RSI, we can see the RSI is still staying above that trend line after price was dropping yesterday. I think we should get an answer very soon on whether or not we will see this pattern work out and price breakout or if it fails. My suggestion is to keep a close eye on all the things pointed out on this snapshot. If it fails and we drop, we also have that green support zone below as a final safety net for the bulls to keep this rally going.
Comment:
Price broke out above the neckline of inverse H&S, we also see volume breakout and RSI is still staying above its trend line as well.
Now we might see price come back down to re-test that neckline before continuing up so those who waited for the breakout confirmation should enter on that trend line re-test
Now we might see price come back down to re-test that neckline before continuing up so those who waited for the breakout confirmation should enter on that trend line re-test
Comment:
I see some traders claiming this pump is nothing but a short squeeze. Yet open short positions on Bitfinex just jumped much higher today. Same thing we have been seeing throughout this entire bull run, more shorts opening as price continues to grind higher. Now I realize open long positions are nearly double the amount of shorts open at the moment but this is only because some big players who have been shorting since 2018 finally closed out their short positions to avoid a loss (there was no squeeze). What we are seeing on shorts is a continuation of what was happening before the dump in shorts, more retail traders trying to predict the tops and opening more shorts on the way up. I think this will come back to bite them but that's just my 2 cents :)
Comment:
So after breaking the neckline yesterday, we saw a nice move up as I was expecting and price hit a high of $12,800. Since then price did drop a little bit overnight but the new uptrend is still intact and we are still above the rising black trend line (see screenshot below). Additionally, the RSI is still well above its rising blue trend line.
Looking higher, we see the obvious resistance being around $13,800 which is the current ATH for 2019. But the target measured move for this inverse H&S pattern is actually up at around $14,390. This is calculated by taking the measurement of the head (from the neckline) and then applying that same percentage move from the neckline breakout upwards.
Looking higher, we see the obvious resistance being around $13,800 which is the current ATH for 2019. But the target measured move for this inverse H&S pattern is actually up at around $14,390. This is calculated by taking the measurement of the head (from the neckline) and then applying that same percentage move from the neckline breakout upwards.
Comment:
Trend line still barely holding on, but RSI trend line has already been broken. I took some more profits as I'm not too sure about price reaching target for H&S anymore. This drop had some decent selling volume on it, but again let's just keep a close eye on that rising trend line.
Trade closed: target reached:
Black trend line has been broken, all long orders were closed. I will update later with a new idea...looking like a double top on the daily now