Bitcoin Forms Bump And Run Reversal Bottom, Target Is Over $100,000
After bitcoin soared to over $26,500 following yesterday’s release of the US Consumer Price Index (CPI), the price corrected sharply. The price of BTC briefly dropped just below $24,000. At the time of writing, Bitcoin is trading at $24,868, below key resistance at $25,200.
However, Charles Edwards, founder of Capriole Investments, spotted an extremely bullish chart for bitcoin that could push the price to over $100,000. Via Twitter, Edwards wrote: “Bitcoin Bump & Run Reversal textbook perfect bottom is back and target is over $100,000.”
Here’s What Bitcoin Bump and Run Reversal Means
A Bump And Run (BARR) reversal, as the name suggests, is a reversal pattern that occurs when excessive speculation drives prices down too much and too quickly until they reach extreme lows. The pattern, designed by Thomas Bulkowski, was also included in his book The Encyclopedia of Chart Patterns.
The circuit consists of three main phases: entry, hit and run uphill. As Edwards shows in the chart below, the price of Bitcoin has formed an initial phase on the 3-day chart from November to 2021 to May 2022, which begins with a series of downward peaks that play an important role in the initial trend line.
The up phase begins with a sharp drop as the price moves further away from the trend line. This phase began for Bitcoin in June 2022 when the price plummeted before further surges took place, causing the price to hit new extreme lows.
At the end of the surge phase, BTC experienced a strong uptrend in January 2023, causing the price to break the trendline.
Both in mid-February and yesterday, there was a return to the trend line, where the price of BTC bounced up. Thus, Bitcoin has confirmed the start of the uphill phase that begins when the pattern breaks. At this stage, Bitcoin could top $100,000 by mid-2024, Edwards said.
More Bullish Chart Patterns
The founder of Capriole Investments also found two more reasons to be optimistic in the short to medium term. Edwards shared the following two charts and tweeted:
Accumulation of Head & Shoulders and Wyckoff at last resistance before $30K. This week’s close is above $25, and in terms of old-school technicals, things aren’t much better.
For now, the resistance at $25,200 remains the most important level that Bitcoin needs to break in order to create bullish momentum. Back in February, the price deviated from resistance three times. Yesterday’s breakout did not last, so it remains the boundary for the start of a new bull run.
Credit : www.newsbtc.com