Bitcoin is doing some crazy things in the chart, and I want to talk about it because I think all of you are very interested in knowing what's happening with the Bitcoin price. I'm going to address the inverse head and shoulders formed earlier today. We have seen many head and shoulders patterns formed recently on the charts.
We saw an inverse head-and-shoulders pattern form, and this is not the first head and shoulders. We've seen a lot happen recently. When we see a breakout from the neckline, we know that it's time to pay close attention because it is usually time to trade. The target was down at $33,392. There is a potentially more significant head and shoulders forming, and for that, if we see a breakout to the downside, we could see a fall to a target of $23,700.
A break out at the neckline is usually a short signal, that a call to buy when prices are low. Another head and shoulders formed, and its target is all the way at 36500.
We did see a one-hour close above the neckline, and that is usually a good sign. We did get some volume, not tremendous, but some.
When we look at the four-hourly, we see a different scenario playing out. We didn't get to see a four-hourly close above the neckline. Usually, when we see this happen, this is a bad sign. It often indicates that we are going to go in the opposite direction in the short term.
It is a signal that in the short term, the bitcoin market is bearish.
Another interesting pattern that formed is the ascending wedge. This broadening ascending wedge did break to the downside. We wanted to see bitcoin hold above at the support level, but we were not able to do that. That is not a good signal for the short term because it could indicate a coming dump.
So right now, $30,000 and $34,000 are 2 of the main areas moving forward. If it does rally and breaks above these levels, the next critical support level, of course, would be the $40,000 level. At that level, it would imply that some of the strength is returning to the market, and the bulls have a stronger hold on the market. Above that is the crucial $42,000 level, where bitcoin will break above its current all-time high.
