After a rather volatile rally to $ 13,000, bitcoin's price action has moderated a bit. But, the case for future earnings remains strong, based on a technical setup that popular Youtube and Twitter BTC analyst Carl Martin shared today. This will surely cause the bulls' hopium levels to skyrocket. According to him, the leading cryptocurrency will soon hit the previous all-time high of $ 20,000. But there is a catch.
Bitcoin's path to $ 20,000 in 2020 has a reverse head and shoulders
According to a reverse head and shoulders (IH&S) configuration shared by Carl, who, incidentally, goes by the name 'TheMoon', the price of bitcoin has already passed the first two stages of the IH&S pattern. Based on this, Carl commented that the $ 20,000 price target is closer than it appears.
🚨 ALERT 🚨
Target: $ 19,700 (We want to see at least 1 weekly close above the neckline first) pic.twitter.com/Xy2mSF3ttZ
– The Moon 🌙 (@TheMoonCarl) October 23, 2020
Generally speaking, market participants regard IH&S as one of the bullish indicators, in addition to the golden cross and some wedge formations. Explosive price races follow the successful completion of an IH&S pattern. Sometimes the upside targets look like the height of the middle slump.
How does this setup play out?
According to the analyst, the bitcoin price chart printed the first IH&S low towards the beginning of this year, when BTC rallied in response to ongoing geopolitical conditions. The next formation was after the Black Thursday crash in March. This is when the price of bitcoin dropped to $ 3,858. And then after a short period of lateral trading, it started to rally towards the end of April to the beginning of May.
BTC formed the third channel of IH&S after rebounding after the September crash (after a flat trading phase, of course). This is the current rally in which bitcoin broke this year's high and hit $ 13,200. Carl said the next stop is $ 19,700, but for that, BTC has to post a weekly close above the outlined 'neckline'. But will it happen?