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  • Bitcoin is pushing the impact of the head-and-shoulders pattern with $8,200 as the critical target.
  • The rising wedge pattern is dangerous for the accrued gains; its effects could test $6,400.

Bitcoin’s recently formed head-and-shoulders pattern is still the center stage of the current price action. The ongoing recovery emanates from lows close to $7,400 to highs testing $7,600. A head-and-shoulders pattern is a pattern that is used in classic technical analysis to predict a reversal from the previous extended trend. In this case, Bitcoin’s recovery from the dive from levels above $8,000 to the previous support marginally above $6,500.

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Although the momentum from the support at $6,750 fizzled out at $7,700, Bitcoin has remained relatively bullish. The 50 Exponential Moving Average (EMA) on the 1-hour chart has also been instrumental in stopping losses towards $7,400. Moreover, the 100 EMA gave an assurance that enough support was available, and buyers only needed to worry about the recovery.

BTC/USD 1-hour chart

BTC/USD price chart
BTC/USD price chart by Tradingview

An accelerated trendline emanating from the support at $6,750 is proving to be quite helpful in averting lower corrections and encouraging the buyers to keep moving. The significant trendline support, forming part of a larger rising wedge pattern will come in handy later, a reversal occurs towards $7,000.

Bitcoin must continue to take advantage of the momentum offered by the head-and-shoulders pattern to extend the bullish action above $8,000 and even form support past $8,200. On the flip side, a reversal below the rising wedge pattern could see Bitcoin drop fast below $7,000 and even taste $6,400 support.

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Meanwhile, the short-term trend will remain bullish as long as the RSI sustains the upward movement. High volume and increasing levels of volatility are the ingredients Bitcoin needs to forge the much-awaited move above $8,200.

Bitcoin Key Technical Levels

Spot rate: $7,530

Relative change: +90.50

Trend: Generally bullish

Volatility: Shrinking

RSI: bullish above the average, which shows a stronger bullish grip.

Support: $7,400, $7,000, $6,750 and $6,500

Resistance: $7,600, $8,000 and $8,200

Summary

Bitcoin Price Analysis: BTC/USD Conflicting Signals, Is it $8,200 Or $6,400?

Article Name

Bitcoin Price Analysis: BTC/USD Conflicting Signals, Is it $8,200 Or $6,400?

Description

Bitcoin pushing the impact of the head-and-shoulders pattern with $8,200 as the key target.
The rising wedge pattern is dangerous for the accrued gains; its effects could test $6,400.

Author

John Isige

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Coingape

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Coingape is committed to following the highest standards of journalism, and therefore, it abides by a strict editorial policy. While CoinGape takes all the measures to ensure that the facts presented in its news articles are accurate.

Disclaimer
The views, opinions, positions or strategies expressed by the authors and those providing comments are theirs alone, and do not necessarily reflect the views, opinions, positions or strategies of CoinGape. Do your market research before investing in cryptocurrencies. The author or publication does not hold any responsibility for your personal financial loss.



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John Isige , 2019-11-29 14:31:35 ,

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NewsBlock © 2019 - 2020 All rights reserved.

NewsBlock © 2019 - 2020. All rights reserved.


While Bitcoin’s price seemingly moves without rhyme or reason — collapsing by dozens of percent and embarking on face-melting rallies on a whim — the cryptocurrency market is filled to the brim with fractals.

Related Reading: Analyst: Bitcoin Price Likely to Fall to Low-$8,000s as Chart Remains Weak

A brief aside: A fractal, in the context of technical analysis and financial markets anyway, is when an asset’s price action is seen during a different time. This form of analysis isn’t that popular, but it has proven to be somewhat valuable in analyzing Bitcoin.

One recent fractal popularized by a well-known cryptocurrency trader is implying that BTC is going to return to the low-$7,000s in the coming days.

Bitcoin Fractal Implies Retracement to Low-$7,000s

A well-known crypto trader going by “Tyler Durden” on Twitter recently posted the chart below, which shows that a Bitcoin price fractal may be playing out. The fractal has four phases: horizontal consolidation marked by one fakeout, a surge above the consolidation phase, a distribution, then a strong drop to fresh lows.

If the fractal plays out in full, BTC could reach the low-$7,000s again, potentially as low as $7,100. This would represent a 20-odd percent collapse from the current price point of $8,800.

It isn’t only a fractal that is hinting Bitcoin has the potential to visit its lows. As we reported on Saturday, Bloomberg believes that if the GTI Vera Convergence Divergence Indicator flips red, a downtrend could push the cryptocurrency back to $7,300.

Related Reading: Stephen Colbert Pokes Fun at Bitcoin in Monologue: Mainstream Gone Wrong?

Can Bulls Step In?

But again, many believe it is irrational to have such bearish interpretations of the cryptocurrency’s chart at the moment. As reported by NewsBTC earlier, Popular crypto trader Mayne recently noted that the “people waiting for $6,000” are irrational. He quipped that Bitcoin retracing and consolidating after its fourth-biggest bull move in history ($7,300 to $10,500, a 42% gain) is perfectly par for the course, but noted that it’s totally possible we can go lower from $8,800.

The medium-term technicals support this.

Trader and CoinTelegraph contributor FilbFilb found that by the end of November or start of December, the 50-week and 100-week moving averages will see a “golden cross,” which he claims is far more significant” for the Bitcoin market that other technical crosses.

Also, a Bitcoin price model created using Facebook Prophet machine learning found that the leading cryptocurrency is likely to end the year at just over $12,000. What’s notable about this model is that it called the price drop to $8,000 months in advance, and forecasted a ~$7,500 price bottom for BTC.

To put a cherry on the cryptocurrency cake, Crypto Thies observed that when Bitcoin bottomed at $7,300, it bounced decisively off the 0.618 Fibonacci Retracement of the move from $3,000 to $14,000, which correlates with the two-week volume-weighted moving average. He added that summer 2019’s consolidation was marked by Bitcoin flipping major resistances into support levels, implying that a bullish reversal and subsequent continuation is likely possible in the coming weeks.

Featured Image from Shutterstock


Nick Chong , 2019-11-10 12:00:38

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