Story by: Tony Spilotro
Bitcoin loves to trade inside triangles. The leading crypto asset by market cap just broke down from a multi-month triangle and spent most of 2018 trapped inside a descending triangle that ultimately broke down.
However, all of this price action may be part of an even larger symmetrical triangle formation dating back as far as Bitcoin’s all-time high, that if confirmed could have a target of over $50,000.
Triangles Inside Triangles And Bitcoin’s Target of $50,000 or More
Bitcoin may currently be in a downtrend, as a result of a triangle that broke down in late December. Technical analysts were torn on if the triangle was a symmetrical triangle, which often suggests continuation is ahead, or a descending triangle, that often leads to a breakdown.
Bitcoin eventually broke down from local highs, suggesting that the asset was indeed in a descending triangle, much like the descending triangle from the 2018 bear market, that also eventually broke down, taking Bitcoin to its bear market bottom at around $3,150.
However, all of this price action may be just noise within a massive symmetrical triangle that Bitcoin may have begun forming well before it’s all-time high was ever set. Bitcoin’s all-time high, in fact, was the first touch of the trend line acting as overhead resistance, and the most recent top at $14,000 is the second.
If the massive structure is a symmetrical triangle as the trend lines would suggest, then the target of the triangle pattern would be somewhere around $50,000. The bottom of the enormous symmetrical triangle would be somewhere around $4,200 – where Bitcoin first broke out from in April 2019, sparking a parabolic rally that only recently topped out.
The target also falls in line with Plan B’s highly cited stock-to-flow model, which suggests Bitcoin will reach a new all-time high of $55,000 by the crypto asset’s upcoming halving in May of 2020.
Related Reading | Crypto Analyst: Bitcoin Downtrend In Full Swing
The apex of the triangle also extends will into 2021, suggesting that a new all-time high may be aways off. However, the triangle target would be somewhere above $50,000, so if the formation is valid, a new all-time high is just about guaranteed.by