BTC/USD is looking at a pennant breakout
A prominent pennant chart pattern appears on the 4-hour BTC/USD chart. There is a case for a break in both directions but this looks like a continuation pattern based on a few factors.
%20(2)-637009554184353834.png&w=1536&q=95)
The RSI indicator has made a failure swing (marked by the line and arrow on the chart), also sometimes known as a hidden bullish divergence. This is when the indicator makes a lower low (highlighted on the RSI indicator on the chart) when the price makes a higher low wave (within the pennant). The MACD indicator is also coming in from a lower position and looks to be shaping for a move back up above to mid-line. On the weekly charts, both the RSI and MACD indicators are in a bullish position. This is not to say there might be a retracement but longer terms the charts look like having a bullish bias.
If BTC/USD does break lower then there is a support level lying in wait at the psychological 11,000 level. On the upside, the next resistance hangs around the previous major wave high of 13,161. Lastly, when the price moves lower the volume indicator is showing that there is a lack of interest, although this can change when US participants join the fray.
Author
Rajan Dhall, MSTA
FX Daily
Rajan Dhall is an experienced market analyst, who has been trading professionally since 2007 managing various funds producing exceptional returns.
