Well our friendly neighborhood Bitcoin did not waste anytime reaching new highs with segwit2 now fully in it's review mirror.
High and Tight!
In the days I was working out of a prop trading office there was a successful trader that used to yell out....
- High and Tight!
He would yell this in excitement because it was a pattern he traded often that fit his style of momentum trading.
As I look at the daily chart for bitcoin all I can hear is him yelling "High and Tight!"
This is what it means.....
Whenever you get a large volume candle (like the one we got on 8/5/17) followed by small candles that trade only in the upper end of that large candle, you essentially have high and tight action.
Looking at the price action in the chart above you see we broke through the $3k resistance with a large green volume candle. Volume is circled at the bottom and you will see the volume bar on that day was above average.
These are the items you want to see on a breakout.
Healthy Consolidation
Now we are getting healthy consolidation. What I mean by that is the buyers are taking a breather, but are still clearly in control as we remain in the top third of the breakout candle.
This high and tight pattern usually leads to another momentum move higher.
However, there are no guarantees, this is only probabilities. We could certainly pull back and test $3k as a support (and probably should) but it would not surprise me if we leg up again beforehand, assuming price action continues to stay high and tight on the current candle.
It looks like Bitcoin wants to GO - so here's the new theme song:
If you want to use your Bitcoin to trade stocks, currencies and commodities - 1broker.com is the place you can do it!
Best Regards,
Disclaimer: All info within is for informational use. Chart data from Tradingview.com
