Bitcoin Hit $5.8k! Summer Bull Market Incoming?

Bitcoin hit $5.8k and now we are experiencing a healthy pullback to the $5.5k level. While viewing the weekly chart above, Bitcoin’s sequential indicator is on a green 4 of 9. Furthermore, Bitcoin is still in its countdown phase to a 9 which indicates bullish price action is likely to continue into the summer. However, we will likely see mild pullbacks along the way similar to the one we just experienced. 

In fact, it would be healthy for the market if Bitcoin was rejected at $6k and fell to $4k only to find support and rally higher. This way, Bitcoin would create a true higher low and would be in an optimal situation for price to rally higher and break above the $6k resistance level. We discussed this concept in depth in one of our previous articles.

As a trader, some may argue it’s better to be late on calling the bull market than wrong about the low at $3.1k. Taking a large long position before price breaks above $6k could get some traders into trouble because there isn’t enough confirmation to establish the start of a bull run. For the most part, veteran traders want to trade the perfect trade, meaning they want the highest percent confirmation with the lowest possible risk. Arguably, it’s better to be late to the party than to jump onto the bus prematurely. Conversely, long term holders will want to continue accumulating, regardless of short term price fluctuations. 

The Daily Chart 

Bitcoin is currently experiencing a new yearly high. The sequential indicator is currently on a green 6 of 9 on the daily chart which implies price will continue to move upward throughout the next three days of the week. At this point, reaching the $6k resistance level is becoming a likely probability.

The 4hr Chart 

Bitcoin reached a green 9 on the 4hr chart and pulled back shortly afterward. For this reason, one of the most fundamental rules of trading sequential is that a green 1 following a green 9 is not a tradable candle, especially when the trend has reached a green 9 two sequences in a row. While viewing this price action on the 4hr chart, our previous green 9 wouldn’t have provided enough conviction to take a short position, but it was enough to indicate a high likelihood of a pullback.

Conclusion

For now, the uptrend remains intact as the bulls have the opportunity to push price to $6k. If price pulls back below $5.5k we will likely see a much larger retrace to even the $5k level.

Disclaimer: Nothing in this article should be considered financial advice. The author of the article owns Bitcoin.