Tired of Bitcoin’s consolidation? Well, then there is good news! After spending considerable time in a contracting trading range, Bitcoin may well be on course to register another breakout. There is a significant probability that the breakout may be on the upside and lead to swift gains for the cryptocurrency.
Bitcoin is currently trading at $244.42.
Image: https://www.tradingview.com/x/Q4z46ho3/
Technical analysis of the 240-minute BTC-USD price chart conveys that the cryptocurrency is well poised for the next leg of its rally. However, the support of $240 must not be violated.
Bitcoin Chart Structure – A quick glance at the above-presented chart reveals a bearish technical pattern called Descending Triangle Pattern. Generally, the completion of this pattern is considered when the floor is breached, which leads to a sell-off in the underlying security. In the current case, the support value i.e. $240 has been respected while the resistance is being challenged successively. A powerful breakout would push the price significantly higher.
Moving Average Convergence Divergence – The Histogram is fast erasing the losses in the anticipation of a positive breakout, even as the MACD and the Signal Line decline. The Histogram has risen up to -0.2244 while the MACD and the Signal Line dropped to 0.0031 and 0.2275 respectively.
Momentum – Traders will also find that the Momentum reading is rising in support of the breakout. The value has quickly jumped into the positive territory and is currently 2.4700.
Relative Strength Index – The 14-4h RSI indicator is seen stabilizing above 40. The latest value is 51.9741.
Conclusion
Market participants should consider building long positions while placing a stop-loss below $240. The targets on the upside are $250, $255 and $260. Book partial profits when the price rises to these levels. In case, the pattern fails and $240 is cracked, liquidate all long positions and create fresh short positions for a target of $230.
