Triangle is Double-Edged Sword

Originally published in a Bitcoin BullBear BTC/USD short term update issued on 3/5/2014.

Chart #2: We also want to take a look at the normal scale 2day chart for a better look at the medium term technicals. As you can see, the market has yet to break out of the triangle pattern, moving right up to the upper trendline before consolidating back into the mid 600’s $. We see this as healthy market activity, but there could be some further weakness before the triangle breakout is complete.

Regarding the indicators, the MACD is very close to crossing over and turning higher, the RSI is still trending up and is about to break the 50 line (buy signal), the Williams % remains strong, and the longer term EMA’s are still rising. Conversely, the Parabolic SAR remains bearish, the TRIX has crossed into negative territory, and there is still overhead resistance at the triangle top. All of this supports the thesis that the market will continue to consolidate in the near term, perhaps down to the 100day EMA around 550 - 560 $, however we would view that as a good medium term entry point for the next push higher.

BTC/USD 2day chart on March 5, 2014:

BTC/USD 2day chart on March 11, 2014:

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