Bitcoin's recent price movements have crypto traders everywhere railing at Bart Simpson for roiling the market. Below, we'll explain why,…
Bitcoin's recent price movements have crypto traders everywhere railing at Bart Simpson for roiling the market. Below, we'll explain why, but first, let's take a look at the flagship cryptocurrency's movements today.
Bitcoin price action has not changed much since our previous analysis. The digital currency continues to trend inside a narrow channel. Whether or not this channel is a bull flag cannot be determined just yet. The only positive thing in the current trend is bitcoin's ability to hold onto gains it made during February 8's impressive bull run.
As of Thursday afternoon, the bitcoin-to-dollar rate (BTC/USD) was trading at $3,576, down a modest 0.02 percent since the Asian session open. Both the volume and volatility are lower since the previous upside run. That somewhat hints that the bitcoin price is closing in towards its next big move. Nevertheless, the interim bias conflict has made it difficult to predict which direction bitcoin would pursue in the coming days: downward, sideways, or upward.
The ongoing bitcoin price action has first brought us before the very famous Bart Simpson. Yep, that Bart Simpson who is also our bearish indicator for today - no pun intended. But before we dwell further, let's have a look at the image in the tweet below:
Technically speaking, a Bart Simpson pattern occurs when a sideways action follows an unexpected spike in price, and then the price drops back again - suddenly. The price action matches the shape of Bart Simpson's head.
In the current bitcoin price action, the BTC is halfway fitting the definition of the Bart Simpson pattern. A full Bart will develop if the cryptocurrency undergoes a sudden bearish correction, such that it erases its previous gains. Should that happen, bitcoin is looking at a downside target towards $3,355. That's what a straight Bart Simpson head can do.
But the glass is half full. The bitcoin price has not entirely invalidated the bull flag formation, which became a central point of discussion in our previous analysis. The BTC/USD rate is still consolidating inside a little descending channel, which could mean there is still a chance that the pair would extend its upside momentum.
A retest of the descending channel resistance, coupled with an increase in volume, will confirm a bull flag. Then, bitcoin will be able to break above the said resistance to set the next upside target towards the red line on the top (in the chart above). From a broader perspective, this upper red trendline makes the resistance of a medium-term symmetrical triangle. Have a look:
As long as the bitcoin price stays inside the descending channel, we will keep our bets inside the range. That being said, a bounce from support would have us open a long position towards resistance. Simultaneously, a pullback from resistance would have us enter a short order towards support.
We will avoid placing breakout targets for today.
Instead, we'll leave you with something to chew on:
Bart Simpson Image from Shutterstock. Charts from TradingView.
Last modified (UTC): February 14, 2019 5:36 PM