As the bullish line for Bitcoin (BTC) begins to decline and the price enters a sideways pattern, crypto traders and investors are looking for signs that indicate when the next extension of the rally for the largest cryptocurrency by market cap may occur.
New price signal to watch the second part of Bitcoin bullish rally
Looking at the chart patterns, there are certain prominent signals that allow analysts to make reasonable assumptions about Bitcoin’s price in the near future, including observations made by crypto analysis team TradingShot using the TradingView platform on Jan.
Analysts first noted the implementation of the Adam and Eve (A&E) pattern (a double bottom pattern rising with twin bottoms at almost the same price), which has begun to form since the FTX boom in November and is consistent with its target.
“As you can see, Wednesday’s top was not only the result of the $21,500 resistance created by the November 5 top, but also completed a +18.00% rise from the December 14 high.”
According to the analysis, Bitcoin is currently trading sideways and moving to test the four hourly moving average at 50 data points (4H MA50) for the first time since Jan.
Bitcoin price action analysis. Source: TradingShot/TradingView
What to look for?
On the basis of these movements, “either this will lead to a correction or a prolongation of the rally” Confirmations or more precisely moving average convergence divergence ( MACD ) and relative strength index ( RSI ) indicators can be sought.
“First, take a look at the 4H MACD. A bullish cross would be a signal to enter round 2 of the rally. The 4H RSI has a clear higher low trendline as support and a lower high trendline is leading it there. A break above previous lower highs would again be a buy signal.”
As a reminder, a bullish cross occurs when the MACD line crosses above the signal line that presents an entry point or buying opportunity for traders, while a bearish crossover occurs when the MACD line crosses below the signal line that indicates a sell opportunity or a sell opportunity.
Bitcoin price analysis
Meanwhile, the flagship decentralized finance (DeFi) asset was changing hands at $21,104 at press time, adding to cumulative gains of 25.14, up 1.79% in the last 24 hours and up 11.83% from last week.
Bitcoin 7 day price chart. Source: Finbold
Meanwhile, the crypto community at CoinMarketCap is showing a bearish trend for BTC for late January and currently forecasts the average price to trade at $19,390 on January 31, representing an 8.09% drop from its current price.
Disclaimer: The content on this site should not be considered as investment advice. Investment is speculative. When investing, your capital is at risk.
Source link
