Has Bitcoin Confirmed A Bullish Retest Of “Meme” Downtrend Line?
Bitcoin price may be at among its most critical moments in its short just over a decade history. The cryptocurrency has over the last several days retested the all-important “meme” downtrend line extending from all-time high as resistance turned support.
After successfully holding, the bullish retest could be confirmed, and the last dip before Bitcoin’s next bull run could already be behind us.
Has Bitcoin Confirmed A Bullish Retest Of The “Meme” Downtrend Line?
Bitcoin price has spent three years trapped within a downtrend. This downtrend was capped off by a trendline that nearly everyone who has ever laid eyes on a BItcoin chart has likely also seen.
Few charts were shared over the last year without that key line connecting the all-time high and Bitcoin’s 2019 trip to $14,000. Because the cryptocurrency was so well contained by this well-known line, the trendline has become a “meme” throughout the crypto community.
According to Wikipedia, a “meme is an idea, behavior, or style that becomes a fad and spreads by means of imitation from person to person within a culture and often carries symbolic meaning.”
Although everyone is using this trend line, it doesn’t make it any less valid. In fact, it may be the most critical trend line the crypto asset has ever tested as resistance turned support.
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That bullish retest may be over and concluded, according to a zoomed in look at the “meme” trend line. Bitcoin fell below and closed a handful of daily candles below the trend line, but has since made its way back above it as of today. If the daily can close above and hold, it could be the last time the cryptocurrency ever trades below its boundaries.
BTCUSD Daily Meme Downtrend Line Retest Confirmed? | Source: TradingView
Could Another Downtrend Line Develop That Keeps The Cryptocurrency Trend Bearish A Bit Longer?
It is worth pointing out that nearly all other “meme” trend lines have turned out to be just another line meant to be broken but failed to lead to the bull market crypto investors are salivating over.
Looking back throughout the bear market, there have been several trend lines broken (red and blue) that resulted in more downside following, or another more dominant trend line developing.
BTCUSD Daily Downtrend Lines Galore! | Source: TradingView
It also adds to the possibility that this latest meme trend line retest, isn’t all that special. It also could mean another game of the connect the dots will lead to yet another new, dominant trend line developing (purple).
Trend lines, like rules, are meant to be broken. They also can be used against traders especially when so many eyes are on the same crucial level. Chances of an increase in volatility or violent shakeouts are normal during important retests.
Related Reading | Early Bitcoin Investor Sees Parallels Between Now And 2016 Bull Breakout
So while this retest already looks to be confirmed and bulls in charge, a trap is possible where bears push price action back within the trendline. If it holds, however, nearly everyone who has ever stared at a Bitcoin price chart will know this key line is breached, and it could trigger a massive wave of FOMO.
Featured image from DepositPhotos, Charts from TradingView
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Tony Spilotro, Khareem Sudlow