Bitcoin has seen another explosive move in the past 24 hours. At the time of this writing, the leading cryptocurrency has risen to $ 11,800 for the first time in about a year.
This means that BTC gained around 20% in the week. Bitcoin gained 4% on the last day alone – the best daily performance since the rally from $ 10,000 to $ 11,500 on Monday.
The recent surge in bitcoin has been marked by an influx of liquidations from cryptocurrency margin platforms. According to Skew.com BitMEX shorts worth more than $ 5.3 million have been liquidated as a crypto derivative portal in the past alone. This adds to the tens of millions more liquidated in the past 72 hours when BTC shot higher.
Although some expect BTC to crack $ 12,000 in the coming hours, an analyst has found Bitcoin has formed a textbook bear signal. But that does not mean that there will be a correction.
Bitcoin Forms textbook reverse signal
Bitcoin's price developments over the past day have been impressive, but some technical indicators suggest that traders should continue to be cautious. A cryptocurrency trader divided The following graph wrote a few minutes after BTC hit $ 11,800:
"Double 9s on the 6-hour # Bitcoin that are still at the beginning of the candle could end up perfecting themselves."
The trader refers to how the Tom Demark Sequential (TD Sequential), a technical indicator that predicts turning points in an asset's trend, printed a potential reversal candle at its recent highs.
The TD Sequential forms “9” or “13” candles when an asset is likely to be at a turning point. In the case of Bitcoin, a correction is expected according to the following table.
Chart of BTC's price action with TD Sequential overlay by trader "Big Chonis" (@BigChonis on Twitter). Chart from TradingView.com
While the TD Sequential is printing a signal for a possible reversal, the last time BTC corrected just one candle on the six-hour chart, it dropped 1.5%. As can be seen in the table above, this happened on July 27th.
This historical precedent could indicate that BTC bulls are ignoring the potential reversal signal.
Related reading: Crypto Tidbits: Ethereum up 20%, US banks can hold BTC, DeFi still in Vogue
Most indicators remain bullish
Other indicators and analysts confirm the expectation that Bitcoin will ignore TD Sequential "9" and remain optimistic about BTC's short-term outlook.
A trader commented that the asset is ready for further gains in the coming weeks as long as Bitcoin holds over $ 11,500:
"Only a few hours until a massive month end. Only a few days left to close the week over 11.5,000. I personally would have no problem with the corncob hovering between 10,000 and 11,5,000 if this is necessary for sustainable growth of ATH. "
Chart of BTC's macro price action from trader Pierre (@Pierre_crypt0 on Twitter). Chart from Tradingview.com
With funding rates still relatively low, BTC appears to be prepared to continue its upward trend.
FEatured Image from Shutterstock Charts from TradingView.com Price tags: xbtusd, btcusd, btcusdt BTC Just Printed a Textbook Reversal Signal After Surging to $11,800