Bitcoin price may confirm the same type of throwback and retest of the multi-year, “meme” triangle downtrend line from ATH
Today’s Bitcoin price spiked above $ 11,000, reviving the bullish sentiment in the cryptocurrency market. The fact that Bitcoin has successfully confirmed retest the $ 10,000 rise as resistance turned support. At press time, BTC is trading around $ 10,889, up nearly 2% over the past 24 hours.
For most of 2020, Bitcoin price and altcoins have skyrocketed together, but at times deviates
Over the past 24 hours, something odd happened, Bitcoin almost outperformed Altcoins by a significant variance. Bitcoin Dominance is exiting a downtrend after it has been able to hold above critical support and is showing signs of bottoming out on high timeframes. If so, the altcoins could run into trouble.
But even though Bitcoin is currently in a bullish trend, raising over $ 1,000 from local lows, and retesting critical support has turned resistance, the price action may have slammed into a brick wall.
BTCUSD Daily Head and Shoulders Chart Pattern & Throwback | Source: TradingView
The potential peak pattern – head and shoulders – has sent Bitcoin price back down to retest $ 10,000, having just retested its neckline. So far, even though $ 11,000 has been held, the neckline hasn’t been pierced yet, and rejection is likely to be forming.
According to expert Thomas Bulkowski, head and shoulders patterns often experience a return to the neckline to keep “interesting trading”. The ahead of and shoulder pattern shows a tug of war between the buyer and the seller; ultimately, the seller wins.
A kickback stopped short late players, and those two placed a stop loss on the near-line. However, like the example on Bulkowski’s website, the back throw can dash straight through the neckline before falling.
If a reversal to support turns resistance holds, the pattern might confirm a deep drop below $ 10,000. Or will it?
Retesting support that has flipped is a retest of the price. However, Bitcoin’s price may have recently confirmed the same pattern of reversals and re-examines the multi-year “meme” triangular downtrend line from all-time highs.
BTCUSD Weekly Symmetrical Triangle Chart Pattern & Throwback | Source: TradingView
This line acted as defacto to the beat of the bulls, and they did. Now they must defend their victory to march forward. The head and shoulders are formed on daily timeframes, while the triangle is huge, visible on weekly, monthly, and higher timeframes.
In technical analysis, the highest timeframe chart patterns are given more. That might suggest that retesting this bullish triangle goes beyond the importance of daily head and shoulder retesting.
But while it is true that high timeframes do prevail in TA, the inversion is supposed to start on the lowest possible timeframe. If this is the case, no matter what monthly, weekly or lower it says, it could drop by day, hour, and even minutes between a new bull market or another bearish event.
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