A closely followed crypto analyst and trader is unveiling what he believes will propel Bitcoin (BTC) to his target of $58,000.
In a new strategy session, pseudonymous trader Cheds says that Bitcoin looks bullish after breaking out from an ascending triangle pattern.
“You’ve got $46,000. You’ve got the higher low structure. Now you’ve got this ascending triangle. This is the most logical way to look at it as a bull, and the ascending triangle is normally a bullish continuation pattern… The measured move would be the height of the triangle. [It] gets us to around $56,000 to $58,000.”
While Cheds is bullish on Bitcoin, he says traders should keep a close eye on the 200-day moving average as the technical indicator is currently acting as resistance.
The analyst also highlights that market participants should watch how Bitcoin trades in the coming days. He says bulls must defend BTC’s immediate support or face the risk of a sell-off event.
“Below $45,000, we’re in serious trouble. That’s the bottom line from everything I know and have studied. So I talked about that. You want to hold the throwback. It initially failed. [It] hasn’t completely failed yet, but there’s some signs of weakness.”
In technical analysis, a throwback is the tendency of an asset to revisit the breakout point in an effort to flip the previous resistance into support.
As long as bulls manage to keep BTC above $45,000, Cheds says Bitcoin is one resistance away from igniting a 26% rally from current prices.
“We’ve got to stay above $45,000… We have a good shot because all you have to do really is clear the 200-day moving average. You clear [the 200-day moving average] I feel like $58,000 is going to be 80% – 90%. That’s the measured move from the triangle [and] the last major cluster after the breakdown.”
At time of writing, Bitcoin is exchanging hands for $46,024.