May 26 , 2019
Yesterday's candle close was above the $8,000 above the psychological number - $8,000 is a round number and it should act as a resistance level but the price manages to close above of it.
Yesterday's candle close made a break above the triangle (red lines). Chart pattern breakouts are usually really good when the breakout has occurred into the trend direction. At the moment, the trend is definitely upwards and the breakout has occurred upwards, so, really nice. Also, the breakouts are more reliable on the higher timeframes. If the breakout above or below the chart pattern has occurred on the 1H timeframe then this is a bit weaker breakout than on the Daily, as it is right now, perfect!
EMA 8 & 21 on the 4H timeframe have a Golden Cross which is good confirmation for further movements upwards after the breakouts. EMA 100 & 200 have a Golden Cross on the Daily chart , which is supporting that current breakout into the trend direction. Break above the small Bull Flag . It has made yesterday but still, we can count this as a momentum sign. We have an unusual chart pattern.
Actually, we have a chart pattern but in an unusual area. The pattern is an Inverted Head and Shoulders ( IHS ). Usually, the IHS is a reversal chart pattern and it occurs at the end of a downtrend but currently, it is top of the trend and it doesn't work as a reversal pattern. Currently, it is just a small indication for further movements upwards and it should work as a slight continuation pattern. The pattern gets valid after the break above the neckline, let's say a candle close above the strong area at $8,200. Then we have again 2 in 1 - break above the chart pattern and break above the strong area at $8,200 Usually, the resistance areas getting weaker after every hour after every day when the price stays into the resistance area.
If the price stays into the previously noted resistance or support area too long then it decreasing the trade success rate. Currently, we waited for throwback and actually we got it but the price climbed still back into this area and probably it is ready to make another leg upwards because it has been too long in this resistance area , which is actually pretty strong. The last Weekly candle close gave us a 66% probability, over a small sample size, that the price may go to the higher levels. Over the past, the Weekly candle has closed above the $8,000 price level three times. Two times it has moved upwards: - Breakthrough on 2017 November guided the Bitcoin price into the ATH ( all-time high), close at $8,031 - Breakthrough on 2018 April guided the price to the $10,000 price level, close at $8,355 One time it had a fakeout - Breakthrough on 2018 July was a fakeout, close at $8,216 and next week the candle goes back below $8,000.
Vertical Traders Team
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