Bitcoin’s Bullish Signals
Several long and short term signals indicate a renewed bullish trend for Bitcoin. A combination of Gann analysis and the Ichimoku Kinko Hyo system identify bullish continuation moves.
The Bull Charges On
Before I get into the price action component using the Ichimoku system, I want to discuss one of the important Gann cycles present. First is the swing high found on June 26th which is just 4-days after June 22nd. June 22nd is one the most important dates in Gann’s work, one of the 90-day seasonal days. It is 93-days (90-degrees) from the start of the Gann year on March 21st. It is also 180-degree from December 23rd. It is very common for an important swing high or low to be found around that date, which is exactly what happened with Bitcoin. This brings us to today. Gann wrote about the daily time rule in which minor changes occur ever 7, 10, 14, 20, 21, 28 and 30 days. Yesterday’s swing low was 21 days from the June 26th high. These Gann factors compliment the price action on Bitcoin Ichimoku chart.
The image above is Bitcoin daily Ichimoku chart. Yesterday’s (July 17th, 2019) and today’s candles show two shared behaviors – they both found support and bounce off of the top of the Kumo. Additionally, price found support between the Fibonacci ratios of 38.2% and 50%. This is the first real test of the Kumo that has occurred since Bitcoin broke above the Kumo on March 5th, 2019. This is a great example of technical leading fundamentals. Yesterday’s bullish close created sufficient conditions for another bounce off the Kumo today. But the bullish move today was exacerbated by some positive fundamental news. North Carolina Congressional Representative Patrick McHenry stated, “I think there’s no capacity to kill Bitcoin. Even the Chinese, with their firewall and their extreme intervention in their society, could not kill Bitcoin.” (CNBC).
Additional bullish condition on shorter time frames. The chart above shows two charts: Bitcoin’s 4-hour Ichimoku chart on top and Bitcoin’s 1-hour chart on the bottom. The 4-hour chart shows Bitcoin continuing to push and close above the Kijun-Sen, with the Chikou Span very near crossing above price, this would fulfill an aggressive day-trading Ichimoku strategy known as the K-Cross strategy (created by Manesh Patel). The 1-hour chart shows even more short term bullish price action. First, price has broken above the current downtrend line as well as crossing above the Kumo. Senkou Span A is greater than Senkou Span B indicating a bullish outlook in the future. We also have both the Tenken-Sen and Kijun-Sen at the exact same level, but unless something extremely bearish occurs, the Tenken-Sen will cross above the Kijun-Sen. Most importantly, I believe, is the Chikou Span crossing and closing above the Kumo. All of those conditions on the hourly chart have generated one of the most conservative but highly probable bullish trade strategies: the ideal Ichimoku breakout strategy. The next key price zone for Bitcoin to test is where the current daily Kijun-Sen is at: 11,469.72.