Bitcoin is back again! And how, since our previous price analysis, the price of bitcoin has risen by around 13 percent. Bitcoin is now worth around 9,500 euros.
So we can say that the bullish scenario has come true. But how did this increase come about? And what can we expect from the bitcoin rate?
Don’t feel like reading? Neither did Axel, so he made a video:
Looking back: party, bitcoin breaks out!
Bitcoin has broken out of a falling trend line, you can see that on the zoomed circle. And that outbreak is good news: it means that the downward trend of recent weeks is over, at least for the time being. A small review of the last days.
Tuesday we wrote that bitcoin was about to break out. The price fluctuated between a falling trend line (orange line) and a support (green bar).
The same day the bitcoin price broke through the trend line. The line was then “tested”. That means that the price looks up the trend line again. Bitcoin continues to rise after the test. We can therefore say that the outbreak is successful.
Bull flags cause an increase
Bitcoin formed a bull flag on Thursday 1 August. And that leads to a price rise in most cases.
With a bull flag the course seems to move in the form of a flag. A successful bull flag proceeds as follows:
- The pole. First the course moves up sharply.
- The flag. Then the price moves down in two parallel trend lines.
- The outbreak. The course moves out of the trend lines. The outbreak upwards is usually about as large as the pole.
The first outbreak also forms the pole for a new bull flag. And this bull flag has also broken out. Bitcoin can go fast!
Does the recurring pattern lead to a new rise?
Will the price of bitcoin rise further? On the basis of a recurring pattern it looks like it. We see a recurring pattern in the course of the price of bitcoin, which can turn out positively.
The graph above shows the price of bitcoin and the 100 Moving Average. We have zoomed out the graph a little, each bar on the graph now represents four hours. You look at the rate from April to now.
The 100 Moving Average is the average of the past 100 time units (periods of four hours). You can see this line as a kind of dynamic support and resistance zone.
The course has plunged below this line several times. But bitcoin came back every time. In fact, here the advance began to a significant rise. Does this mean that bitcoin again expects a sharp rise?
What can we expect from the bitcoin rate?
It remains positive for bitcoin. That was a bit different last week, when the rate fell considerably. The trend lines from last week’s analysis are still interesting. We therefore include this in the two scenarios for this week.
The price of bitcoin is rising, but as you can see we first have to go through an important resistance (bottom red bar on the graph). This zone is between 9,600 and 9,800 euros.
Does bitcoin overcome this resistance? Then the price rises towards 10,700 euros, that level is on the upper slanting trend line on the graph. In the most favorable scenario, the value rises to 12,000 euros, the current peak of 2019.
In the negative scenario, the bitcoin fails to break the resistor. We then drop back to the support (the orange bar on the graph).
If the value of bitcoin falls further, the price is probably supported on the lower trend line. In that case, bitcoin drops to 7,600 euros.
And does bitcoin break out at the bottom of the trend line? Then the rate drops to 6,200 euros, where bitcoin then finds support.