Bitcoin (BTC) could be set for historic gains thanks to a simple trend line breakout, a popular trader hopes.
In a Twitter discussion on May 5, Titan of Crypto flagged a rare bull signal on the Bollinger Bands indicator for the Bitcoin monthly chart.
Bitcoin price may see “inexorable breakout”
BTC price action currently impacts sentiment in different ways across various timeframes. While observers are unsure about short-term moves, zooming out, consensus remains that Bitcoin’s upside mostly lies ahead as the block subsidy halving approaches.
When it comes to tracking what comes next, however, it may be enough to look at halving cycles past — specifically, volatility.
As Titan of Crypto notes, Bollinger Bands on monthly timeframes are setting up a repeat of a breakout event that has occurred only once in each cycle.
In the two previous instances shown on an accompanying chart, 2016 and 2019, BTC/USD broke through into the upper section of the Bollinger Band channel to see significant gains.
Bollinger bands are a key volatility indicator across price timeframes. They revolve around a 20-period simple moving average (SMA) functioning as a midline, with two standard deviations above and below representing the channel.
These bands expand and contract with volatility, and certain events, among them price coming into contact with the bands or even breaking beyond them, are often considered important by traders.
Currently, the one-month BTC/USD chart shows price attempting to break above the SMA line, something which, if confirmed, would suggest a classic repeat of past bull runs.
Commenting, Titan of Crypto described it as an “inexorable breakout.
”BTC is about to break its monthly Bollinger Bands base line. And when that happens 1st target will follow inexorably,” he added.
“That would bring Bitcoin to a solid $63,500.”BTC/USD annotated chart. Source: Titan of Crypto/ Twitter
While not quite enough to match its current all-time high, the price target could come around the point of the halving in one year’s time. How long it will need in reality remains to be seen, Titan of Crypto acknowledged.
BTC price bides its time
Last month, meanwhile, John Bollinger, the bands’ creator, himself argued that Bitcoin was at a crucial point on daily timeframes.
Related: Is Bitcoin overbought or oversold? Use Bollinger Bands to find out!
At the time, price was retesting the SMA line as support, subsequently breaking through to range around it. Now, however, it is heading higher toward the upper band, data from Cointelegraph Markets Pro and TradingView shows.
BTC/USD 1-day candle chart (Bitstamp) with Bollinger bands. Source: TradingView
Subsequently, analyst CryptoCon suggested that low-timeframe Bollinger Bands norms were still intact despite Bitcoin’s comedown from local highs of $31,000.
Even with the last drop in #Bitcoin price, this time is still not different for the Bitcoin 3 Week Bollinger Bands!
Large corrections have always taken place after the upper parameter is met AND exceeded, but not a moment before
The price of the upper band is still $35,790 pic.twitter.com/kQol55Ovmh
— CryptoCon (@CryptoCon_) April 29, 2023
Magazine: Crypto audits and bug bounties are broken: Here’s how to fix them
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
Source: https://cointelegraph.com/news/bitcoin-trader-eyes-63k-btc-price-for-new-bollinger-bands-breakout
