By Jeff Clark – the editor of the Delta Report Newsletter
Have you noticed, nobody seems to talk about bitcoin anymore?
That’s what happens after a long, drawn-out decline in any asset. Folks get tired of calling for a bottom, hoping for a bounce, and trying to time the next big rally. Folks give up. They shut up. And they move on to other things.
That’s usually about the time when the asset starts to rally.
So, the recent silence in the bitcoin world is probably a bullish sign. And it just so happens that the chart is starting to look bullish, too. Take a look…
For all of last year, this chart remained in a pattern of lower lows and lower highs. That’s a downtrend – and it pressed the price of bitcoin down from a high of about $19,000 to a low near $3,200.
The pattern over the past two months, though, has morphed into a “consolidating triangle.” This pattern is created when a chart chops back and forth in a relatively tight trading range, and it serves to build energy for the next big move.
If you look closely, you’ll notice that bitcoin appears to have broken above the resistance line of this triangle. You’ll also notice that all of the various moving averages (the squiggly blue, green, and red lines) have coiled together. So, there’s plenty of energy to fuel a large move.
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The last time this chart displayed a similar pattern was back in November. Bitcoin had chopped back and forth in a tight trading range for a few months. The moving averages were coiled together. And, we got a big move – lower.
This time, though, with bitcoin having recently broken above the resistance line of the triangle, it looks to me like the odds favor the next big move for this cryptocurrency to be higher.
It wouldn’t surprise me to see bitcoin trading back near its December high of about $4,200 within the next few weeks.