BTC/USD: A Clear, Bullish Trend

22 oct 2020

In this post, I'll be analyzing Bitcoin's weekly chart, demonstrating why the overall trend is extremely bullish.

Analysis
- To begin with, it's important to note that we have broken out of the descending trend line resistance on the weekly chart (marked by the blue trend line)
- This is a trend line resistance that valid for over 2 years
- Now that we have broken out of this resistance, it is now a resistance-turned-support
- We saw a pullback; a correction in the price to retest the support, before rallying further upwards
- This was a pullback that I have anticipated, and also mentioned in my previous analysis:

- Bitcoin broke out through the 0.5 Fibonacci retracement resistance, and hit the 0.618 levels yesterday
- Overall, this has created a clear uptrend with higher lows and higher highs, and prices trading within an ascending parallel channel
- We can also notice the signs of a bullish reversal, as prices have been painting a reverse head and shoulders pattern
- While the Relative Strength Index (RSI) can be concerning, as it is reaching overbought territories, we can see from past technical indicators that the RSI entering overbought regions does not necessarily indicate the end of a bullish trend
- We can also see that there is a lot of bullish momentum, as the Moving Average Convergence Divergence (MACD) has formed a golden cross, immediately after forming a death cross

Conclusion
In summary, Bitcoin's overall trend is very bullish. Since the trend is your friend, the best strategy is to buy the dip, until Bitcoin provides a clear confirmation of a trend reversal. Simplicity is key.

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