Bitcoin Begins to Stall After Parabolic Ascent

Share Article
In Brief
  • Bitcoin has been following a parabolic ascending support line.

  • Technical indicators have begun to show weakness.

  • The price is possibly trading inside a symmetrical triangle.

  • promo

    Gravity Dex Protocol: Bringing DeFi to Cosmos

The Trust Project is an international consortium of news organizations building standards of transparency.

After a parabolic increase, the BTC price stalled and created a Spinning Top candlestick on Nov 18.

Sponsored



Sponsored

The price has begun to show signs of weakness, but a breakdown is not yet confirmed.

Bitcoin Follows Parabolic Support

The Bitcoin price has been following a parabolic ascending support line since the beginning of September. At the time of press, BTC was trading just above this support line.

Sponsored



Sponsored

On Nov 18, BTC followed up its previous bullish candlestick with a Spinning Top, a sign of indecision, especially when coming after such a strong upward trend.

The price is also in the process of completing an evening star pattern (highlighted). The pattern would be complete with a close below $16,700, the opening price on Nov 17 (red line).

Such a decrease would also cause a breakdown from the parabolic support line.

BTC Chart By TradingView

Technical indicators in the daily time-frame have begun to show weakness. The RSI has generated a bearish divergence and the Stochastic oscillator has begun to roll over, possibly getting ready to make a bearish cross.

While the MACD is overextended, it has not yet begun to decrease.

While these are potential signs of weakness, they do not yet confirm a downward trend. A breakdown from the line would likely cause a bearish cross and a decrease in both the MACD and RSI, confirming the reversal.

BTC Chart By TradingView

Short-Term Movement

The shorter-term chart shows that the price is trading inside a symmetrical triangle, currently being at the support line of the pattern. Furthermore, it is trading inside the $17,550 support area.

A breakdown from the triangle would likely take the price back down to $16,770, the 0.618 Fib level of the most recent increase. This zone is also a horizontal support level and the target found by projecting the length of the triangle to the breakdown point.

BTC Chart By TradingView

If the support area manages to hold and cause a breakout above the symmetrical triangle (red line), BTC might increase above the Nov 17 high and move towards the all-time high price near $19,500.

At the time of press, however, that scenario seems unlikely.

BTC Chart By TradingView

Conclusion

Bitcoin created a Spinning Top candlestick and stalled after a massive increase. The price is trading inside a short-term symmetrical triangle, from which a breakdown is the most likely outcome.

For BeInCrypto’s previous Bitcoin analysis, click here!

Disclaimer: Cryptocurrency trading carries a high level of risk and may not be suitable for all investors. The views expressed in this article do not reflect those of BeInCrypto

Disclaimer

All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.
Sponsored
Share Article

Valdrin discovered cryptocurrencies while he was getting his MSc in Financial Markets from the Barcelona graduate school of Economics. Shortly after graduating, he began writing for several different cryptocurrency related websites as a freelancer before eventually taking on the role of BeInCrypto's Senior Analyst.

Follow Author

Market signals, studies and analysis! Join our Telegram Today!

Go

Market signals, studies and analysis! Join our Telegram Today!

Go

Market signals, studies and analysis! Join our Telegram Today!

Go