First Mover: ‘Bull Flag’ Call for $70K Bitcoin Draws Skepticism From Rival Analysts
  Everything you need to make sense of the crypto markets and beyond By the CoinDesk Markets Team Edited by Lawrence Lewitinn, Managing Editor, Global Capital Markets March 31, 2021 Sponsored by  (Price data as of March 31 @11:00 UTC) If you were forwarded this newsletter and would like to receive it, sign up here.
Good morning. Here's what we're writing about:
Check out the CoinDesk TV show "First Mover," hosted by Christine Lee, Lawrence Lewitinn and Emily Parker, at 9 a.m. U.S. Eastern time. Today the show will feature guests:
Biggest Movers These are the biggest movers in the CoinDesk 20 over the past 24 hours:
Gainers: Losers:
The CoinDesk 20 filters from the larger universe of thousands of cryptocurrencies and digital assets to define a core group of 20. These assets constitute roughly 99% of the market by volume at eight of the largest and most trustworthy exchanges.
Market Moves by Omkar Godbole  'Bull Flag' Call for $70K Bitcoin Draws Skepticism From Rival Analysts
A debate is raging among bitcoin traders after a chart-reading analyst spotted a pattern known as a "bull flag," ostensibly portending a coming rally to $70,000 or beyond.
The analysis, posted on the website Bitcoinist by Yashu Gola and affirmed by Bill Noble at Token Metrics, concluded that the bull flag has formed over the past month, and that the cryptocurrency's price is set to pop after a breakout in recent days.
But when it comes to identifying and interpreting price-chart patterns, there's an art to the science, and some practitioners of bitcoin technical analysis say they can't see the flagpole needed to complete the picture.
"I disagree that there is a flag pattern because there is no real 'flagpole' preceding the consolidation phase that has been resolved to the upside," Katie Stockton, a technical analyst for Fairlead Strategies, told CoinDesk in an email.
The debate has reached such a fever pitch that it was trending Tuesday on the social-media site Reddit:
 Bitcoin post trending on Reddit (Source: Reddit) The controversy comes as bitcoin (BTC) continues to draw all manner of bullish predictions, from all corners of the market, having rallied six-fold since October. While some analysts have modeled out long-term price forecasts of $100,000 or even $1 million based on a range of methods, few traders are currently calling for a rally to $70,000 in the short-term.
According to the original post on Bitcoinist, the cryptocurrency broke out of its bull flag pattern on Tuesday, signaling the end of a two-week-long price-consolidation phase and marking a resumption of the broader uptrend.
Under the theory of chart analysis, also known as technical analysis, a flag breakout signals that an asset is likely to move upwards, roughly on the scale of the preceding bull move, which is known as the pole. In this case, the breakout has created an opening for prices to move toward $70,000 or beyond, according to Gola.
Bill Noble, chief technical analyst at Token Metrics, a cryptocurrency research company, mostly agreed with the Bitcoinist post in an email, saying the pattern does look like a bull flag on the four-hour chart.
"If you look at the four-hour chart, the bull flag appears as a parallel channel," he said. "In my mind, this makes the pattern very clear."
"Simply put, the recent consolidation in BTC is a pause that refreshes," according to Noble. "Depending on what time frame you use for the measurement, the upside target for BTC could be either $75,000 as per the four-hour chart or $80,000 per the daily chart."
 Bitcoin's 4-hour chart (Source: Bill Noble, Token Metrics) However, some analysts say the pattern does not qualify as a bull flag, and traders are running ahead of themselves in making bold predictions based on it.
The rally seen in the first two weeks of March should have been much steeper or bigger in magnitude to qualify as the flag's pole, according to Stockton. What appears instead is a pole almost equal to the size of the so-called flag.
"For it to be a flag, in my opinion, the early-March rally would have been steeper, and new highs would have been registered versus the high point of the consolidation phase," she said.
 Bitcoin's daily chart (Source: TradingView) Gola, when asked for his response to the critique, told CoinDesk in a LinkedIn chat that the price structure looks like a bull flag despite the pole not being steep enough.
He said the price projection was supported by news developments this week, including the payment giant Visa's announcement that it will process transactions on the Ethereum blockchain, along with PayPal's plan to roll out a cryptocurrency check-out service across some 29 million online merchants. Both were seen as signs of growing mainstream adoption of digital assets, which could be broadly beneficial to the bitcoin market.
"I professed my upside bias based on rising volumes, as the price rose on daily timeframes before entering a consolidation period," Gola said. "Also, the bull flag works in conjugation with supportive fundamentals, including the latest PayPal and Visa announcement. We need to look at all the sides."
"Anyway, it is a humble opinion, not an outright claim," he said.
Even if traders agree that bitcoin's bull flag has appeared in the price chart, there's still lingering doubts over whether the breakout is confirmed yet, according to Eddie Tofpik, head of technical analysis and senior markets analyst at London-based ADM Investor Services International Ltd.
"Minimum of two consecutive UTC closes" are required above the flag hurdle before the breakout is confirmed, Tofpik said, and "maybe more, given the nature of the market." A "UTC close" refers to the price of bitcoin at midnight, Coordinated Universal Time. Since global cryptocurrency markets are always open, many traders use that time as a way of marking the end of one trading day and start of the next.
A price rejection around the March 15 all-time high, just above $61,000, could cause a reversion back down, Tofpik said.
Perhaps not a red flag, but a yellow one at the very least.
--Omkar Godbole
Read the original story here: 'Bull Flag' Call for $70K Bitcoin Draws Skepticism From Rival Analysts
A message from Nexo  Your digital assets deserve a savings account in their BEST INTEREST. Leading crypto lender Nexo treats you, your crypto and your fiat to industry-best Crypto & Fiat services, featuring:
* Up to 12% interest on digital assets, paid out daily! * Yields available on BTC, ETH, LTC, BCH, XRP, XLM, EOS, TRX, LINK, BNB, PAXG, USDT, USDC, TUSD, PAX, DAI, HUSD, GBP and EUR. * No minimum or maximum limits on funds deposited, offering infinite opportunities to earn. * #ZeroFees on all transactions. * Military-grade wallet security and top-tier insurance on all custodial assets with SOC 2 Type 2 certified crypto custodian BitGo.
Technician's Take by Damanick Dantes Bitcoin Stalls Near Resistance; Support Around $54K Bitcoin (BTC) approached resistance just shy of the $60,000 level during Asia hours. The cryptocurrency continues to consolidate with buyers showing limited strength from support levels.
 Four-hour BTC chart shows an overbought RSI with support and resistance levels (TradingView/CoinDesk)
--Damanick Dantes
BOLO Be on the look out for these upcoming events:
 CoinDesk's Christine Kim and Will Foxley, along with Consensys' Ben Edgington, present a weekly podcast series on the live development of Ethereum 2.0 and its potential impact on the crypto markets.
In each episode, the team discusses major news events related to Eth 2.0 from addressing skepticism to the consequences of node slashing, and gives updates on the status of CoinDesk's own Eth 2.0 validator.
Listen to Mapping Out Eth 2.0 every Thursday on the CoinDesk Podcast Network.
ICYMI In case you missed it, here's this past Friday's episode of "First Mover" on CoinDesk TV:
Circle CEO Jeremy Allaire joins "First Mover" to discuss today's top stories, including Visa's decision to use USDC, the stablecoin developed by Circle, to settle payments. Also, reaction to Tether's accounting report. Plus, Travala CEO Juan Otero on using crypto to pay for travel, and why Mark Cuban invested in Esprezzo.
Sponsored Content
CME Group: The Beginnings of Institutional Ethereum: Recapping the First Few Weeks of CME Ether Futures
Latest Headlines
A message from CoinDesk  CoinDesk's Christine Kim and Consensys' Ben Edgington present a weekly podcast series on the live development of Ethereum 2.0 and its potential impact on the crypto markets. In each episode, the team discusses major news events related to Eth 2.0 from addressing skepticism to the consequences of node slashing. Listen to Mapping Out Eth 2.0 every Thursday on the CoinDesk Podcast Network.
Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments. ATTENTION: Scammers have been sending fraudulent emails with links to sites disguised to look like coindesk.com. If you are in doubt about a link, type https://www.coindesk.com directly into your browser; do not copy and paste. Remember, if something seems too good to be true, it probably is.
Copyright © 2021 CoinDesk, All rights reserved.
250 Park Avenue South New York, NY 10003, USA You can manage your preferences here or unsubscribe from all CoinDesk email. |
