Fittingly on the last day of 2017, cryptocurrencies are set for an encore performance. When the bitcoin price first breached the remarkable $10,000 level, the “blockchain markets” responded vigorously. Both bitcoin and major altcoins soared to previously unimaginable levels. But when the bitcoin price reached just under $20,000, the cryptocurrencies suffered a massive correction.
Naturally, mainstream analysts who were starting to warm to the idea of cryptocurrencies as valid investments started to pile back on the bearish bandwagon. Unfortunately for their reputation, they have likely switched sides prematurely. Currently, the bitcoin price is back above $14,000 on many exchanges, and even more encouragingly, the altcoins are enjoying a robust comeback effort.
As everyone knows by now, cryptocurrencies are incredibly volatile investment vehicles. The bitcoin price and the altcoins could just as easily break down further into the valley. But coincidentally, many, if not most cryptocurrencies are tracing bullish pennant formations. This “triangulation pattern” which I identified for ripple prior to its $2 breakout move is extremely powerful in the blockchain sphere. Let’s consider the following charts:
- Bitcoin price chart
- Ethereum price chart
- Bitcoin cash price chart
Critics of technical analysis may claim that the success of the aforementioned triangulation pattern is merely a coincidence. But for those naysayers, they should peruse the cardano price chart:
Note that cardano is currently enjoying the fruits of the bullish pennant formation. At the apex of the triangle, the cardano price exploded skyward. This is the result of the bullish and bearish trading deadlock that ultimately culminated in a breakout move.
For whatever reason, technical analysis works tremendously well in forecasting cryptocurrencies. Since the bitcoin price chart, as well as the charts for major altcoins, are exhibiting similar formations, the probability in my opinion favors long investors.
One thing is for sure: 2018 is going to be anything but uneventful for cryptocurrencies!