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Why Bitcoin May Be On The Verge Of A Powerful Move

By Lance Roberts | October 22, 2018
, Why Bitcoin May Be On The Verge Of A Powerful Move

After its powerful surge in late-2017 and stunning plunge in early-2018, Bitcoin’s volatility has died down significantly as it settles into a narrowing range just above its key $6,000 support level. This narrowing pattern appears to be a descending triangle, which has very bearish implications if the cryptocurrency breaks below the key $6,000 support level in a convincing manner with high volume. A decisive break to the upside, however, would increase the probability of further bullish action. Either way, when a market narrows to a fine point like Bitcoin is, it typically indicates that a volatile move is likely ahead upon a final breakout or breakdown.

, Why Bitcoin May Be On The Verge Of A Powerful Move

The weekly Bitcoin chart puts this descending triangle pattern into perspective a bit better:

, Why Bitcoin May Be On The Verge Of A Powerful Move

Bitcoin volatility is at unusually low levels according to Bollinger BandWidth (a volatility indicator), which means that there is a high probability of a strong move soon:

, Why Bitcoin May Be On The Verge Of A Powerful Move

I will be watching closely for a breakout or breakdown to confirm this descending triangle pattern.

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Lance Roberts is a Chief Portfolio Strategist/Economist for RIA Advisors. He is also the host of “The Lance Roberts Podcast” and Chief Editor of the “Real Investment Advice” website and author of “Real Investment Daily” blog and “Real Investment Report“. Follow Lance on Facebook, Twitter, Linked-In and YouTube
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