On the daily chart we have a symmetrical triangle, we have just tested the bottom of the triangle for the third time and are now trying to test the top of the triangle once more.
A symmetrical triangle can break either way and is neither bearish nor bullish, break decides the longer term direction.
On the 4h we see an ascending triangle, these triangles usually break up indicating more upside and an attempt to test the symmetrical triangles top line.
On the 1h we see a rising wedge appear, this is a bearish pattern. A break down is more likely than a break up. The apex of the wedge sits at around the $8100 mark which also marks an area of heavy horizontal resistance. If you go long on the break of the ascending triangle on the 4h this should be your target area.
On the 15m chart we see a nice support zone created by the previous channel. Chances are we are going to test this zone before moving up.
However we also see a bull flag being drawn in on the 3m. Since 3m patterns aren’t that reliable I like to skip calling it a bull flag (which would indicate a break towards the upside) and instead call it a downtrending channel where the break will decide short term direction, but is not a signal to enter.
How do we play this chart/analysis?
our current bias is towards the long side, so we are looking for a long position on bitcoin. However in the short term we do expect a retracement and this would be our moment of entry.
If we don’t get the retracement we must break the ascending triangle and the rising wedge towards the upside, we enter a long on the retest of resistance now support at the top line of the ascending triangle.
our target is the heavy horizontal resistance line at the $8100 area.
We either buy the retracement, scaling in from $7658 to max downside risk at $7424 (which is the bottom line of the ascending triangle.)
or buy the re-test of resistance now support after breaking the ascending triangle towards the upside at $7760
Stop scenario 1: $7311
Stop scenario 2: $7620