Bitcoin started the month of August on the positive, regaining control of the $10,000 price level. After the step back BTC took in July, the bull run appears to have been resumed since a wide number of indicators are giving signs of a higher move under different timeframes. This technical analysis will explore the probability for a bullish impulse that takes Bitcoin to new yearly highs.
Bitcoin technical analysis
Based on the 1-month chart, Bitcoin remains extremely bullish. According to @MoonOverlord, BTC appears to be mimicking its behavior from its previous three bull runs. The popular cryptocurrency trader on Twitter noticed that Bitcoin’s price action, in the long-term perspective, is characterized by an accumulation period that is followed by a doji around the “median long-term regression line.” Then, this tends to lead to a major breakout. Under this idea, BTC seem to have formed its fourth doji last month and now it could be preparing for its next bull run that could take it to up to $50,000.
There’s been 3 Doji monthly candles along the median long term regression line after bitcoin broke above it
After each one #bitcoin has tapped the top band
This month we’re forming our potential 4th doji / (uncertainty candle)
A run to the top band would put $BTC at $50,000+ pic.twitter.com/eFDt8U1FFx
— Moon Overlord (@MoonOverlord) August 2, 2019
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Although it is too early to tell whether Bitcoin will be able to reach $50,000, the fact is that recently a golden cross between the 7 and 30-month moving average developed under this timeframe. The last time such a bullish formation took place was in May 2016, when BTC was trading around $570 and was followed by a 3,600 percent rally that took it to an all-time high of $19,760 on Dec. 17, 2017.
Similarly, Bitcoin is coming from a 339 percent upswing that lead to a golden cross between the 7 and 30-month moving average and could be signaling that this cryptocurrency is likely to resume its bull trend and make new all-time highs, if history indeed repeats itself.
It remains to be seen if Bitcoin is able to end the month of August above the $10,000 level, which could be taken as a strong indication of the continuation of the bullish trend in the macro perspective. Since this price point has acted as support and resistance in different occasions in the past, and July closed above this level with the highest volume of the year so far, as @BigChonis pointed out, it can be seen as a pivotal point.
$BTC several monthly candles have closed right under, right above or got rejected right at $10,000…The July Monthly candle has just closed above this price level with the highest volume of the year so far…What does August have in store…? pic.twitter.com/bHuVs9qNAu
— Chonis Trading-⚔️ (@BigChonis) August 1, 2019
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Based on the 1-week chart, closing this month’s candlestick above $10,000 does not seem to be a problem. Under this timeframe, Bitcoin is moving above the 7-week moving average once again after dropping below it for the first time since mid-February. Regaining the support given by the 7-week moving average will validate the bullish scenario seen in the 1-month chart allowing the bull run to be resumed.
Adding to the bullishness, the TD Sequential Indicator on the 3-day chart, has presented a buy signal in the form of a green nine. This technical index predicts a 3 to 12 days upswing that will be confirmed if the next candlestick is a green two trading above the current green one candlestick. Thus, the areas of support and resistance given by the Fibonacci retracement indicator forecasts a move to the 23.6 percent Fibonacci retracement level. This could lead to a higher impulse that takes Bitcoin up to the 16.18 Fibonacci retracement level or higher.
$BTC going up today is nice and all but dont get lost in the excitement
macro outlook is still grim with a 17-20% decline still on the cards before we can look for a new impulse back up to all time highs?♀️
short term bullish mid term bearish long term “we all gonna make it fam” pic.twitter.com/o6stNxZnlX
— ??BenjaminBlunts?? (@SmartContracter) August 2, 2019
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Along the same lines, @SmartContracter believes that in the mid-term perspective the chances are high for a 20 percent correction from the 23.6 percent Fibonacci retracement level that could actually take BTC down to the 61.8 percent Fibonacci retracement level. Since this Fibonacci retracement point is considered to be the ‘golden’ retracement area, such a drop will suggests a rebound, which may allow the uptrend to continue.
Despite the bearish views of both analysts, there seems to be a bull flag forming on the 1-day chart. This is considered a continuation pattern that develops after a strong upward movement, known as the flagpole, and is succeeded by a consolidation period, known as the pennant, that tends to breakout on the direction of the previous trend.
Upon the breakout point, the bull pennant predicts a 45 percent target to the upside that was determined by measuring the height of the flagpole. If this bullish formation is validated it could take Bitcoin to around $15,650, subsequently, invalidating the scenarios presented by @CryptoDonAlt and @SmartContracter.
Moreover, if Bitcoin moves above the middle peak of the Adam and Eve double bottom pattern a 15 percent jump to around $12,500 could be anticipated. This will indeed allow BTC to reach the top of the parallel channel seen on 12-hr chart, test the 16.18 percent Fibonacci retracement level per the 3-day chart, and increase the buying pressure behind it so that it reaches the target of the bull flag that developed on the 1-day chart.
Overall sentiment
It is worth paying attention to the bearish side that @CryptoDonAlt and @SmartContracter highlighted. Under their perspective, there is a high probability that the current uptrend will be rejected by the 23.6 percent Fibonacci retracement level that sits around $11,400. Failing to break above this Fibonacci retracement level could result in a 20 to 35 percent correction, taking Bitcoin down to the 50 to 61.8 percent Fibonacci retracement area between $8,500 and $7,300.
However, despite the minor corrections that Bitcoin experienced since the bull rally began in December 2018, in the macro perspective everything seems to indicate that this cryptocurrency is still bullish. In fact, every single time frame evaluated on this technical analysis seems bullish signaling that BTC could soon reach a new yearly high.
The post Bullish Bitcoin indicators converge, new yearly BTC highs within reach appeared first on CryptoSlate.
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