The Bitcoin price action is now sluggish after a volatile half-year. It has struggled to find any type of support, and it continues to grind sideways. While there is no sign that the trend has reversed, it seems like Bitcoin’s top cryptocurrency might finally have support from the trend line of 10 years.
Is it complicated technical analysis or this simple trend line trick?
Technical analysis refers to the study of trading indicators, chart patterns and Japanese candlesticks. This is done in an effort to predict future price actions. A simple trend line is the basis for most chart patterns and technical drawings.
And while it isn’t uncommon to see analysts with a kitchen-sink worth of technical tools turned on, sometimes less is more when it comes to getting a good read on the market.
It is possible to understand why Bitcoin prices may have found support by using only one trend line. The trend line is all that’s needed to show you how buying low can lead to amazing results.
Is this a trend that has been going on for almost ten years?Source: BTCUSD at TradingView.com | Source: BTCUSD on TradingView.com
Is Bitcoin finally gaining support at a decade-long trend line?
The trend line was first established by Bitcoin in April 2013. It is the same as what Mt. Gox took its exchange offline to give the market time to “cooldown.” From there, each subsequent bear market in Bitcoin returned to the same trend line drawn in red.
This trend line was first touched in 2015, then again in 2016, just prior to the 2017 Bitcoin bull market. Although 2018’s bear market did not reach the trendline, support was found before that. The March 2020 Black Thursday fall brought Bitcoin price to the exact same trend line as it is today.
Now, fast forward to June 2022 when BTC touched the trend line once more. The line was again touched in July, but the market held firm for another month. Thus far, August hasn’t made an attempt to try again, and after two failed attempts to break below in a row, it might be time for bulls to rally.
The trend line has been a source of rallies in the past that have produced a 2,200%, 9,700% and 1,500% return on investment, respectively. It could spell doom for crypto if it’s lost. Is this a trend that has been going on for ten years? Or will it end in a crash?
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Featured image taken from iStockPhoto. Charts from TradingView.com