Trade Recommendation: Bitcoin SV
Bitcoin SV’s (BSV/USD) chart is as bullish as it gets from a technical analysis perspective. The best thing about it is the cryptocurrency is just getting started. Based on our read, we are confident that the market will print multiple fresh highs in the next few months.
Technical analysis shows that BSV/USD has broken out of a textbook Adam and Eve double bottom pattern. This happened on May 29, 2019, when the market took out resistance of $125. The reversal pattern was in construction for about six months. Thus, when the market broke out, bulls generated tremendous momentum that catapulted Bitcoin SV to as high as $254 on May 30th.
As though bulls were flexing their muscles, Bitcoin SV consolidated rather than retraced. In the process, they were painting a massive bull flag on the daily chart. We’ve seen this pattern numerous times in the last few months. It suggests a continuation of the uptrend as soon as those who bought the breakout and the bottom are done selling.
Looking at the volume, we can see a significant decline from the May 30th high. This is often a sign that sellers are losing ammunition. With Bitcoin SV approaching the resistance of the bull flag, the cryptocurrency may be positioned to break out of the pattern and resume its uptrend.
The strategy is to buy on the breakout and retest of $236 as support. If bulls can convert the $236 resistance level into support, they will likely attract the momentum to reach our targets of $300 and $340.
The process may take a month.
Daily Chart of Bitcoin SV/US Dollar on Bitfinex
Summary of Strategy
Buy: Breakout and retest of $236 as support.
Targets: $300 and $340.
Stop: $224 after the breakout.
Disclaimer: The writer owns bitcoin, Ethereum, and other cryptocurrencies. He holds investment positions in the coins but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock.