In a Twitter discussion on May 5, crypto titan Bitcoin flagged a rare bull signal on the Bollinger Bands indicator for the monthly chart.
Bitcoin Price May See “Inevitable Breakout”
BTC price action is currently influencing sentiment in different ways on different timeframes. While observers are unsure of short-term moves, the consensus remains that bitcoin’s gains are largely ahead when the block subsidy halves.
When tracking what’s coming next, looking at the volatility of past half-cycles, in particular, is enough.
As Titan of Crypto points out, Bollinger Bands on monthly time frames are set by the recurrence of a breakout event that occurs only once per cycle.
On the two previous occasions shown on the accompanying chart in 2016 and 2019, BTC/USD crossed the upper section of the Bollinger Band channel to see significant gains.
Bollinger Bands are a key volatility indicator across price timeframes. They revolve around a 20-period simple moving average (SMA) that acts as a midline, with two standard deviations above and below representing the channel.
These bands expand and contract with volatility and certain events: among them, price touching the bands or falling beyond them is often considered important by traders.
Currently, the one-month BTC/USD chart shows price attempting to break above the SMA line, which, if confirmed, would suggest a classic repeat of past bull runs.
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In a comment, the titan of crypto called it an “inevitable breakout.”
”BTC is about to break its monthly Bollinger Bands base line. “When that happens, the first goal will inevitably follow,” he added.
“That would bring Bitcoin to $63,500.”
BTC/USD Annotated Chart. Source: Titan of Crypto/Twitter
Although not enough to match current all-time highs, the price target will be halved within a year. How long this will actually take remains to be seen, the titan of crypto admitted.
BTC price gives its time
Last month, John Bollinger, the creator of the band himself, argued that Bitcoin is at a critical point in daily timeframes.
Related: Is Bitcoin Overbought or Oversold? Use Bollinger Bands to find out!
At that point, price retests the SMA line as support and crosses into the surrounding range. However, it is now moving higher into the upper band, data from Cointelegraph Markets Pro and TradingView shows.
BTC/USD 1-Day Candlestick Chart (Bitstamp) with Bollinger Bands. Source: TradingView
Then, analyst CryptoCon suggested that the low-timeframe Bollinger Bands criteria would remain intact despite Bitcoin’s rally from the regional highs of $31,000.
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This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should do their own research when making a decision.
