Here’s Why Bitcoin Could Rise If This Trend Is Confirmed

Bitcoin Bitcoin / US Dollar It traded up about 3% during the trading session on Saturday amid continued momentum after the bullish breakout from the descending channel pattern on July 27, indicated by Benzinga on July 25.

During the session on Friday, Bitcoin canceled the downtrend that it was trading inside the descending channel, but it has not yet confirmed a new uptrend on the daily time frame.

An uptrend occurs when a stock is constantly making a series of higher highs and higher lows on the chart.

Higher highs indicate bulls dominance, while choppy higher lows indicate periods of consolidation.

Traders can use moving averages to help identify an uptrend, with higher lower time frame moving averages (such as the eight-day or 21-day exponential moving averages) indicating that the stock is in a sharp short-term uptrend.

A rise in longer-term moving averages (such as the 200-day simple moving average) indicates a longer-term uptrend.

The arrow often indicates when the higher top is at the top by printing a reversal candlestick such as a doji candle, bearish engulfing candle, or hanging man candlestick. Similarly, a higher low can be indicated when a Doji, Morning Star, or Hammer candlestick is printed. Moreover, higher tops and higher bottoms often occur at resistance and support levels.

On the upside, the “trend is your friend” so it isn’t, and in the upside there are ways for both bullish and bearish traders to participate in the stock:

  • Bullish traders who already hold a position in a stock can feel confident that the uptrend will continue unless the stock hits a lower bottom. Traders looking to take a position in an uptrend can usually find the safest entry at the higher bottom.
  • Bearish traders can enter the trade at the higher top and exit at the pullback. These traders can also enter when the uptrend breaks and the stock hits a lower low, indicating that a reversal to the downside might be in the cards.

Want a live analysis? Find me in the BZ Pro Lounge! Click here for a free trial.

Bitcoin chart: Bitcoin kicked off Saturday’s 24-hour session by printing an inside bar pattern and late this morning the crypto was trying to break away from Friday’s trading range. If Bitcoin closes the trading session near the high of the day and above the high of Friday, the crypto will print a bullish Marubozu candle, which could indicate a higher price in the Sunday session cards.

  • Ultimately, Bitcoin will need a correction to print at least a higher bottom, which will confirm a new uptrend. If that happens, traders can watch the cryptocurrency forming a bullish reversal candlestick, like a doji candle or a hammer candle above $20,715, the most recent low.
  • A pullback is likely to happen over the next few days as the Bitcoin Relative Strength Index (RSI) measures around 64%. When the RSI of a stock or cryptocurrency approaches or reaches the 70% level, it becomes overbought, which can be a sell signal for technical traders.
  • Traders can watch for a downtrend reversal when Bitcoin finally prints a bearish candle, like a shooting star or a Doji grave.
  • Bitcoin has higher resistance at $25,772 and $29,321 and support below at $22,729 and $19,915.

SEE ALSO: How Much Bitcoin $100 Could Be Worth in 2030 If Cathy Wood Price Prediction Comes True

Leave a Reply

%d bloggers like this: