Bitcoin experiences a sharp correction after soaring to over $26,500 yesterday, briefly falling below $24,000. At the time of writing, Bitcoin is trading at $24,868, below key resistance at $25,200.
Charles Edwards, founder of Capriole Investments, has spotted an extremely bullish chart pattern for Bitcoin that could propel the price to over $100,000. Via Twitter, Edwards wrote, “The textbook perfect Bitcoin ‘Bump & Run Reversal’ bottom is back and the target is over $100,000.”
Here’s What The Bitcoin Bump And Run Reversal Implies
The Bump And Run Reversal (BARR) pattern is a reversal pattern that is created when prices reach an extreme low after being driven down too far, too fast. The pattern was developed by Thomas Bulkowski and was also included in his book “Encyclopedia of Chart Patterns”.
The Bitcoin price pattern has three main phases: the lead-in, bump, and uphill run. As Edwards shows in the chart below, the Bitcoin price has formed the lead-in phase in the 3-day chart from November to 2021 to May 2022, which begins with a series of descending peaks that are instrumental to the initiating trendline.
The bump phase begins with a sharp drop, with the price moving further away from the trendline.
This phase began for Bitcoin in June 2022 when the price experienced a sharp drop before rallying to a new high. The uphill run is the final phase of the pattern, where the price moves closer to the trendline. This phase is still in progress for Bitcoin, with the price currently rallying towards the trendline.
Bitcoin has confirmed the beginning of the uphill run phase, which is expected to take the cryptocurrency to over $100,000 by mid-2024, according to Edwards.