On its 6-month chart we can see its still bearishly aligned moving averages with the steadily falling 200-day coming into play overhead, but we can also see that a clear potential intermediate Head-and-Shoulders bottom has formed that appears to be complete, or very nearly so, and the increasing proximity of the 200-day m.a. is making a breakout from the pattern and above this average a growing probability, an outcome that is made considerably more likely by various factors including the volume dieback as the price has tracked sideways marking out the Right Shoulder of the pattern, with a growing preponderance of upside volume, the uptrending Accumulation line during the same period, uptrending momentum (MACD) which is starting to move into positive territory and the now flat to rising 50-day moving average.
Zooming out, an 18-month chart enables us to view the correction from the highs of October last year in its entirety and you will understand why it is called a correction and not a bear market when we look at the long-term chart further down the page. After experimenting with various trendlines on this chart and on a log-scaled version, the best fit was found to be the horizontal downtrend channel shown which, if valid, makes clear that the price has already broken out of the downtrend after which it ran at the resistance level shown and its falling 200-day moving average which together forced it back down to form a Double Bottom with its early February low, albeit at a slightly lower level. However the 2nd low was not confirmed by momentum (MACD) which shows that downside momentum has been abating and the recent volume dieback and positive divergence of the Accumulation line coupled with the increasing bunching of the price and its moving averages all suggest the growing probability of a significant reversal to the upside soon.
The long-term 13-year chart makes crystal clear why Bitcoin may be on the point of not just a short to medium-term reversal but the onset of a major uptrend that takes it comfortably to new highs that are very possibly way above its highs of last year in the 125,000 area – and this makes sense given that gold and silver and other metals are now powering up for a major upleg to new highs in the face of exponentially ramping money creation leading to hyperinflation.
The conclusion is that this is an excellent point to buy /accumulate Bitcoin (and some other leading cryptos) for the probable major uptrend that is expected to take hold soon. Those wishing to play it safe have the option of placing a stop either below the nearby support level at 62,000 (Right Shoulder low) or below 57,800 (low of Head of pattern early in July), perhaps buying back in the event of a break below your stop being a “head fake” (false move) that is followed by its reversing back above the support.
Looks like its time for the old Bitcoin Billionaire song again.
Bitcoin, trading at 65,195 at 12.50 pm EDT on 9th August 26.
Posted at 12.55 pm EDT on 9th August 26.