Some investors may be getting bored with Bitcoin as no particularly strong move is happening in either direction. However, it’s precisely at times like these that Bitcoin could wake up and make that next major move. A couple of chart patterns are forming that could send Bitcoin to the upside. Could they trigger a major rally?
A continuation of bullish W pattern?
Source: TradingView
The 4-hour chart shows the first bullish pattern that is in play. As can be seen, the $BTC price is once more battling just below the bottom trendline of the bull flag. If it is rejected, one has to start looking at the chances of the next possible leg down to $109,000. On the other hand, if the bulls are successful, a breakthrough of the trendline would lead to a continuation of the W pattern to the upside, potentially taking the price back to the top of the bull flag. In the balance of probabilities, this is the more likely scenario.
Bulls lift price back into the bull flag
Source: TradingView
The daily chart reveals how the price action is starting to hold back inside the bull flag. Yesterday’s candle was important in that the price was forced down by the bears, but the bulls managed to bring the price back inside the flag by the end of the day, leaving a reasonably sized candle wick behind that gives evidence of the strength of the bulls.
At the bottom of the chart, the Stochastic RSI indicators continue to the upside, while in the RSI, the indicator line needs to turn around and have another go at breaking through the descending trendline.
Inverse head and shoulders neckline test
Source: TradingView
The second of the bullish chart patterns is best viewed on the weekly time frame. Given the much bigger time frame, this particular pattern is of far more importance and can therefore lead to huge upside.
We have an inverse head and shoulders pattern. The left shoulder and the head were formed in the big descending wedge, while the right shoulder was formed during a bull flag. Since then, the price has gone above the neckline (bold black line) and has now come back to test it.
If this is a successful test and the price elevates from here, the measured move of this inverse head and shoulders pattern can begin to play out.
Measured move to $150,000?
Source: TradingView
The above chart shows how the measured move is taken from the bottommost point of the head up to the neckline. This is then transferred over to the breakout point. As can be seen above, the complete measured move could take the price up to around $150,000. Time will tell if this plays out.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
