The Bitcoin Setup Is Now Bullish

I’ve changed my mind on Bitcoin. The setup looks bullish now.

Yes… It was just one week ago when I presented the bearish case. Bitcoin was trading near $104,000 and bumping into the resistance line of its consolidation pattern.

The momentum indicators were showing negative divergence. It seemed to me the odds favored a pullback in Bitcoin at least towards its support line at $92,000.

We got that pullback last weekend.

Heading Back Up

Unlike most financial instruments, Bitcoin trades around the clock. So, while most of Wall Street was enjoying their weekend, the King of Cryptocurrencies was falling – hard.

For whatever reason, the tariff-related headlines that started last Friday afternoon and continued through the weekend caused some selling pressure in the crypto market.

Bitcoin tumbled all the way down to $92,000, tagging its support line, and hitting my initial downside target.

Since then, the tariff headlines have mostly been resolved – at least temporarily. And, Bitcoin has bounced.

Take a look…

All the momentum indicators at the bottom of the chart are in neutral territory (the CCI is actually just a bit oversold). And, all the various moving averages are now coiled together at about the $100,000 level.

Energy is building for a bigger move. And, since the tariff scare last weekend couldn’t cause a breakdown, my guess is that “bigger move” is now going to be to the upside.

At a minimum, Bitcoin should at least make a run back up to the resistance line at $106,000. But, if it can break through that level, we could see a move as high as $120,000.

In other words, what looked like a potentially bearish setup last week has flipped to bullish.

Bitcoin did indeed move lower, as we suspected it would. But, it found support and stayed inside its consolidation pattern.

The next move should be another challenge of the resistance level.

Best regards and good trading,

Jeff Clark
Editor, Market Minute