U.Today – The largest cryptocurrency by market cap, recently hit $63,000, and veteran trader Peter Brandt has weighed in on this bullish price move.
Bitcoin is on track for its fourth consecutive day of gains, hitting highs of $63,293 in today's trading session after recovering from Friday's lows of $56,538.
According to Brandt, Bitcoin (BTC) could be developing its oft-repeated “Hump Slump Bump Dump Pump” chart construction, a pattern he had observed in the past.
“Bitcoin BTC could be developing its oft-repeated Hump Slump Bump Dump Pump chart construction,” Brandt wrote in a tweet, suggesting that Bitcoin's price action could be following a definite pattern.
This chart construction is characterized by a “hump” or price increase phase, followed by a “drop” or price fall phase. The “rise” phase shows a price increase, followed by a “drop” phase, which is another drop. Finally, the “pump” phase represents a major upward movement, which frequently results in new highs.
Are Bitcoin Bears Trapped?
Brandt added that “the double top attempt on July 5 was a bear trap, confirmed by the close on July 13. The most likely scenario now is that the bears are trapped. The close below $56,000 negates this interpretation.”
On July 5, according to Brandt, Bitcoin attempted to form a double top, a bearish pattern that led to lows of $53,499. However, Brandt identified this as a bear trap, a false signal that tricks traders into believing the price will continue to fall. This view is not far-fetched, as Bitcoin had been falling for days prior to this date.
However, a positive close on July 13 invalidated the double top. Brandt suggests that the most likely scenario now is that the bears are trapped. This interpretation suggests that Bitcoin could continue its upward trajectory.
However, Brandt notes that a close below $56,000 would negate this bullish outlook, so it remains a key level for traders to keep an eye on. At the time of writing, BTC was up 5.05% over the past 24 hours to $62,642.
This article was originally published on U.Today
