$58K Bitcoin next? A’reversal ascending triangle’ indicates to additional BTC upside

According to Bitcoin price charts, $52,500 should be a very difficult resistance level to overcome.

Bitcoin’s (BTC) remarkable recovery from an otherwise bearish technical configuration has increased its prospects of reaching $58,000 in Q2.

Is Bitcoin’s price about to bottom out?

On a daily basis, Bitcoin broke out of its ascending triangle to the upside on March 27, bringing the much-anticipated $50,000 milestone within its range.

Interestingly, ascending triangles are continuation patterns, which means that after they break out of their contracting range, they often resolve by sending the price back in the direction of its prior trend.

Bitcoin avoided further declines after creating an ascending triangle. Rather than that, it broke over the pattern’s top horizontal trendline near $45,000 and continued upward, reaching nearly $47,700, a level last reached on Jan. 2, 2022.

This is one of the few instances in which ascending triangles form near the end of a decline. For example, as veteran market analyst Peter Brandt remarked on March 28, Bitcoin saw a steep upward retracement — from $3,100 to $14,000 — following a similar triangular pattern between December 2018 and April 2019.

The fractal increases Bitcoin’s chances of completing a decisive breakout from its “reversal ascending triangle,” resulting in an extended price rally toward the level equal to the maximum distance between the triangle’s upper horizontal and lower rising trendlines, i.e. around $58,000, as illustrated in the chart below.

 

Weekly timeframe: What’s next, $69K?

Meanwhile, independent analyst “dave the wave” forecasts a rally toward Bitcoin’s current record high of $69,000.

The analyst generated the positive prognosis on a weekly basis using a bigger ascending triangle pattern in conjunction with Bitcoin’s logarithmic support level.

Nonetheless, his setup posed the possibility of Bitcoin reversing course and falling below $40,000 after failing to break through $69,000.

Why $52,500 is the most decisive level

Bitcoin rising triangles on both the short- and long-term charts are exceedingly positive. However, when important weekly moving averages and Fibonacci retracement levels are considered, immediate downside concerns remain.

Notably, Bitcoin’s continuous uptrend began when it repeatedly tested support at its 100-week exponential moving average (100-week EMA; the black wave).

Meanwhile, a 0.236 Fibonacci retracement line (around $36,000) established from the $69,000 swing high to the $26,000 swing low acted as additional support. The $26,000 mark corresponds to the 200-week exponential moving average (the blue wave).

Surprisingly, the comeback resembled the market movements observed between November 2019 and January 2020. BTC’s price gain peaked in February 2020 at the 0.618 Fib level (around $10,500), prompting a fall towards the 200-week EMA a month later.

If Bitcoin makes a similar run in 2022, the BTC/USD pair might hit its current 0.618 Fib level near $52,500 before correcting back toward the 200-week exponential moving average near $26,000. On the other hand, a significant move above the Fibonacci level may initiate the rising triangle setups outlined above.

 

Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.

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