Bitcoin: Short Term Parabolic Trend 1H (May 15)

14 May 2020

X Force Global Analysis:


Bitcoin has broken out of a bullish ascending triangle pattern, after a significant corrective wave. In this analysis, we explore the current technicals demonstrated by Bitcoin's hourly chart.

Analysis

- We have broken out of major resistance zones of 9.3k and 9.5k
- We have also broken through the descending trend line resistance with great momentum
- The most reliable support trend line demonstrates a parabolic trend for Bitcoin
- The technicals demonstrate bullish momentum too
- Relative Strength Index (RSI) shows a clear uptrend, with higher lower and higher highs as a sign of trend strength
- The Moving Average Convergence Divergence (MACD) also demonstrates a clear uptrend, with strong bullish momentum
- However, we have learned from history, that parabolic trends are not sustainable
- After breakouts from more or less four base levels (phases of consolidation), a break down the parabolic trend line takes place, leading to a corrective pattern
- Our last remaining resistance zone is at the previous local high, 10K

Market Sentiment:

The market sentiment is extremely bullish, with long short ratios at 73 to 27.


What We Believe

Whether this bullish move will mark the beginning of a new bullish rally, or whether it's merely a means to eliminate high-leveraged late shorts and provide liquidity in the market for bigger short positions remains murky at the moment. A break and close above 10K levels could confirm a bullish rally up to new highs, while a rejection at those levels could signal a bearish double top formation.

Trade Safe.