Bitcoin (BTC) Price Back on Track Towards $11K, Positive Sign of 4th Monthly Doji Candle
The price of leading cryptocurrency Bitcoin is climbing again after a week of losses. Early yesterday the asset broke through resistance at $10,000 and has since continued upwards to $10,800. Analysts believe if this rally continues it could break through $11,000 today or tomorrow.
The boost was likely precipitated by Friday’s surprise announcement by U.S. President Donald Trump that he will be enacting further tariffs on Chinese imports. Earlier this year in May when the initial Chinese tariffs were imposed by the U.S. government, Bitcoin enjoyed a 26.5 percent increase. It is believed that wealthy Chinese businessmen are moving money out of the country and into Bitcoin for fear the Chinese Yuan may drop as a result of the tariffs.
Yesterday, the price of Bitcoin soared once again after Trump announced tariffs on an additional $300 billion worth of Chinese goods. The rally means the Bitcoin price is now looking like it could form a fourth monthly ‘Doji’ candle on the median long-term regression line – an event that has previously led to a new all-time high (ATH) on three occasions.
Periods of accumulation in 2010, 2012 and 2015 were all followed by Doji candles forming on the median regression line and then a new ATH within a few months. If the pattern continues, the price of BTC will undoubtedly break above $20,000 before the end of this year. Popular cryptocurrency trader Moon Overlord (@MoonOverlord) highlighted the potential occurrence in a tweet, accompanied by a helpful graph revealing the three prior events.
“There’s been 3 Doji monthly candles along the median long term regression line after bitcoin broke above it. After each one #bitcoin has tapped the top band. This month we’re forming our potential 4th doji / (uncertainty candle). A run to the top band would put $BTC at $50,000+,” he stated in the tweet.
Earlier today, Bitcoin risked being blocked by 200-day SMA resistance at $10,675 but now having broken through this, a break above $11,000 is on the cards.
The BTC/USD Confluence detector suggests some weak resistance at $10,886 but this likely won’t present much of a problem. However, resistance at $11,500 could be harder to break through and above that, strong resistance will be met at this year’s previous high of $13,700.
An unlikely retrace to the downside will find weak support at $10,491, with $9,545 and $8,460 below that providing strong support.