Bitcoin eyes $26,000 with a bull pennant breakout forming on the lower timeframe chart as we are reading more in the latest Bitcoin news.
Dubbed as the “Bull Pennant” the pattern forms once an asset forms a Triangle-like structure after the upward flagpole is formed. The traders see it as a signal of bias continuation or they think that the asset would continue in the direction of the previous trend after surpassing the triangle structure. Bitcoin is forming a similar bull pennant on the 1-hour chart that has a few interesting characteristics like flagpole before forming one Pennant structure the BTC/USD exchange rate with rally higher. Also, there’s Price Fluctuation that forms after a flagpole top and the pair consolidated sideways while leaving a trail of low highs and higher lows behind. That gave it the shape of a triangular structure like the pennant itself. The volume is another characteristic which dropped when the BTC/USD pair fluctuated inside the Pennant.
The traders are now waiting for a break above the Pennant to confirm their extended bullish bias and if this move happens, it would shift the upside target by about the height of the Flagpole. In the current case, the height is about $3,200 which means that a breakout move will push the pair at least to $26,294 as measured from the Pennant apex. Bull Pennants have a 70% success rate according to the study conducted by the Samurai Trading Academy. There could still be about 30 percent possibility that the current bullish continuation pattern that could end up being invalid. If this happens, the BTC/USD exchange rate will risk getting lower again as much as the Flagpole height.
That would bring the pair down to $20,000 with the previous resistance target that serves as a support level. The long-term timeframe charts supported the bearish correction outlook so logged a back-to-back gain with the bTC market now standing overheated. The Relative Strenght Indicator on Bitcoin’s weekly charts shows the same picture with overbought signals above 70. In simpler terms, BTC is trading at a higher rate than the ideal bit which leads to neutralizing price moves to the downside. Bitcoin eyes $26,000 which could automatically bring the BTC/USD pair close to below $20,000.
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