Bitcoin is finally creating a series of consistent movements in a pattern we can analyze and identify. The price action is shaping up into a bearish ascending triangle with greater opportunities ahead!
About Triangle Formations
Triangles are a common formation seen in the candlestick patterns of the market after significant price movements up or down. These triangle formations usually occur in areas against resistance and can take several shapes including ascending, descending, and consolidating triangles.
Bitcoin’s Ascending Triangle
We can see that Bitcoin’s movements are resulting in a series of higher lows pushing against the same high. This pattern is showing the resistance at the high mark and is considered ascending since the price is “ascending” toward the high price level.
The Bearish Triangle Slant
This ascending triangle formation is also consider “bearish” because the market broken down from the higher prices around $9,121 price level, reached the low around $3,935, double bottomed around $4,359 and then consolidated upward into ascending triangle structure. Since the global trend is still downward, bearish sentiment rules the global markets.
Bitcoin Market Sentiment: Reversal or Continuation?
The Bitcoin market now has two options:
- Continue the bearish Bitcoin trend and break downward out of this bearish ascending triangle with enough selling volume to solidify the continuation pattern (usually a very high probability overall in ascending triangle movements within the market trend).
- Reverse the bearish trend by breaking upward out of the triangle with enough volume to liquidate shorts, move the market price higher (turning previous resistance into support), and forming a new bullish Bitcoin trend.
Next Bitcoin Trading Steps
We will be watching multiple time frame indicators to see which way the markets swing and trade accordingly.
For Bear Swings and Short Positions: Watch for price rejection from the top of the ascending triangle with volume behind it. Look for indicators trigger points like RSI lower highs with higher price action, Stoch reversals from the upward price movement, and MACD histograms and signals trending and crossing downward.
For Bull Reversal and Long Positions: Watch for price movement up through the top of the ascending triangle with volume pushing it higher. Look for indicators trigger points like RSI higher highs with higher price action, upward Stoch movement on larger time frames, and MACD strength with histograms and signals trending and crossing upward.
I am a simple market analyst – not a financial analyst
fortis Fortuna adiuvat – fortune favors the brave
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