Bitcoin could backtrack its path reaching $ 20,000 in the upcoming sessions, claims an analyst at TradingShot, an independent investment advisory firm.
Bitcoin at 21,000 level
During his announcement last week, the analyst wrote that the benchmark cryptocurrency expects a strong rebound after testing a short-term support trendline. The trendline serves as part of forming the ascending channel and forms a sequence of higher highs and higher lows.
Due to the previous fluctuations, the TradingShot analyst was able to predict a fractal repetition on Wednesday. Today, the price is expected to retreat after testing the ascending channel’s lower trendline, which partially confirmed the call from the Bitcoin analyst, who extended its upward move towards the upper trendline, which is near USD 21,000.
Additionally, the channel support is in line with the 200-period wave of the four-hour time frame moving average. The TradingShot analyst noted that it could also induce traders to re-accumulate Bitcoin on the lower trendline levels.
“Since Channel Up has been very consistent with its high, low and middle trend lines since November 5th, we should consider this a very strong support for BTCand a possible rebound point,” he explained. “The next high is just above USD 21,000.”
The Risk
The analyst also observed a newly formed declining channel pattern that could dominate his bullish outlook.
In hindsight, the channel seems like part of an inverted head and shoulders pattern. The previous retest of the ascending channel support serving as the IH&S floor and classifying two top trendline retests that serve as the right and left shoulders.
The analyst concentrated on the right shoulder from which the descending channel originated.
“The 26./27. November is the head. Assuming the channel breaks up, the IH&S can take the right shoulder BTCUSD as low as the region USD 16,200 – 16,000. With that RSI (on the 4H card) be on a channel below (bearish Divergence) since November 5th (exactly matching the channel up of the price campaign) this is certainly possible. “
The downside target near USD 16,000 corresponds with the 50-day moving average wave for Bitcoin, which is also a support level among traders.
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