In the middle of October, John Bollinger, the prominent technical analyst behind the Bollinger Bands indicator, remarked that Bitcoin (BTC) was going to see a so-called “head fake.”
For those unaware, a head fake in technical analysis terms is when an asset falls out of the Bollinger Bands, an indicator that estimates trading ranges, then violently snaps back into the range as if the asset has entered into either a bull or bear trap.
— John Bollinger (@bbands) October 16, 2019
Two weeks after he made this call, the head fake played out. Perfectly. After Bitcoin closed below the lower Bollinger Band on its one-day chart, the cryptocurrency jumped by 43% in a single day’s time to re-enter the Bollinger Band range, hitting $10,500 from $7,300. The call was impeccable.
Bollinger recently explained what he expects for the Bitcoin and cryptocurrency market to do next. And considering his previous call, this one maybe shouldn’t be taken so lightly.
Related Reading: Crypto Tidbits: Bitcoin Dives Under $8,000, Fidelity Bags Trust License, SEC Takes Second Look at ETF
Bitcoin Bottom Incoming
The prominent technician recently noted that the “setup is looking good” for the crypto market to see a “turkey week bottom,” referencing the fact that it is American Thanksgiving this week.
Turkey week bottom in crypto space? The setup is looking good. $BTCUSD
— John Bollinger (@bbands) November 25, 2019
There is a confluence of technical signals that corroborate this sentiment.
Per previous reports from this very outlet, Marcel Burger, the head of a crypto investment boutique based in the Netherlands, recently noted that Bitcoin’s one-week chart is still showing signs of strength, despite the absolutely brutal 20% drop seen over the past week.
With the S2F model in the back of your mind this chart doesn't look that bad. Big bull flag and still fairly close to the 61.8 fib. pic.twitter.com/JKdmrGjx3b
— ₿urger (@BurgerCryptoAM) November 25, 2019
That’s not all. Burger continued that Bitcoin remains just below the key 0.618 Fibonacci Retracement level, which some analysts call the “golden pocket” of support. If the cryptocurrency manages to flip that level into a support level, it would suggest that upside could be had in the weeks and months that followed.
This optimism has been echoed by popular trader Dave the Wave, an analyst that called the drop to $6,700 some months ago while everyone was calling for $20,000. He remarked that with BTC trading at the bottom of a medium-term channel and the RSI reaching an oversold level, he would be inclined to suggest that Bitcoin is prime to see a bounce.
Related Reading: Uncommon Bitcoin Metric Suggests Massive Profit Taking Is Underway
Featured Image from Shutterstock