A classic indicator suggests that Bitcoin (BTC) could be set for fresh upside moves as BTC price strength returns to key levels.
in a X posts On September 18, John Bollinger, the creator of the Bollinger Bands volatility indicator, said that Bitcoin is ready for a breakout decision.
Bitcoin Bollinger Bands Start “Moving Higher”
After hitting a new September high the previous day, Bitcoin is challenging resistance levels that have been unreachable since mid-August, data from Cointelegraph Markets Pro and TradingView show.
Signs for the largest cryptocurrency are encouraging for Bollinger Bands. Bollinger Bands use the standard deviation around a simple moving average to determine likely price range and volatility.
Currently, Bitcoin/USD is charting daily candles touching the upper band. When this occurs, it may signal an imminent reversal back to the center band, or conversely, an inbound fit with an upward swing.
The recent emergence of narrow Bollinger Bands on Bitcoin has boosted hopes that the latter scenario is about to happen.
“After the lower Bollinger Bands established a new set of control bars, the first label appeared on the upper Bollinger Bands track,” Bollinger Bands commented alongside the chart.
“The question now is, can we move to the top? It’s too early to answer.”
Cointelegraph reported on a range tightening in July, an event that ultimately led to a return to lower levels.
BTC Price Reset ‘Quite Reasonable’
Bollinger Bands describe the current sentiment of experienced Bitcoin traders and analysts over the short term.
Related: FOMC and BTC Price ‘Partial Bottom’ – 5 Things to Know About Bitcoin This Week
Despite the strong week, caution remains as various trend lines that previously acted as support remain above spot prices.
Discussing the situation, on-chain monitoring resource Material Indicators told X subscribers to question the bulls’ momentum.
“We have significant technical resistance at the key moving averages and support at the LL,” some comments noted.
“We will most likely see a round trip within this range and with any luck we will see a legitimate test of the R/S levels which will give us a clear picture of where BTC is headed by the end of the week.”
Materials indicators reference the upcoming Federal Reserve interest rate decision, which could produce sharp moves and untrustworthy short-term trading signals.
Update 2: As mentioned, it appears #BTC Bulls are gaining some momentum, but things are not always what they seem. Let me explain…
Sometime after the close/open of last night’s candle, we saw a new trend prediction ⬆️ signal develop on the daily chart, and now we have a new… pic.twitter.com/V0UI7JznKf
— Material Indicators (@MI_Algos) September 18, 2023
This article does not contain investment advice or recommendations. Every investment and trading activity involves risks, and readers should do their own research when making decisions.