The Bitcoin price suddenly broke higher this morning in what crypto watchers are describing as a very strange sudden increase. On one hand, it looks like a chart technician correctly called for a bullish breakout, while on the other, some are crediting the sudden surge in the bitcoin price to the declaration that cryptocurrencies are permissible under Shariah Law. Still others are crediting a short squeeze or tax season for the rally, as expert opinions on the sudden rally start to pour in.
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Bullish signal identified on bitcoin price chart
Earlier this morning, CoinDesk‘s Omkar Godbole pointed out a bullish pattern on the bitcoin price chart. He noted that the cryptocurrency had been largely range-bound for more than a week, and at the time he wrote that, Bitfinex had it listed at less than $6,900. He also noted that the bitcoin price range was gradually narrowing day by day before finally stagnating for about 24 hours, and he said that could mean that a bullish breakout was on tap.
On the price chart, he identified what chart technicians refer to as a “falling wedge” pattern, which tends to signal that a bullish reversal is about to occur. He also said that any upside break would confirm that the bulls have taken control of the bitcoin price, and that does appear to be what’s happening. He noted that there was also a bearish “pennant” pattern appearing on the price chart, but he argued that since bears didn’t end up taking advantage of the bearish outside-day candle pattern that appeared recently, the bullish signal could be the one that would prevail.
Godbole predicted that the bitcoin price would break past $7,100, which it certainly did just a short time later. Coinbase and other exchanges revealed a sudden surge in the price, which skyrocketed from below $7,000 up past the $8,000 level in about 30 minutes before reversing again and starting to lose some ground.