Bitcoin is currently trading at $421 in a bullish market after an intraday high of $425 and a low of $415. In our last technical analysis we indicated that the Bitcoin market was exhibiting a few prominent patterns which shouldn’t go unnoticed. One pattern we indicated was the head and shoulders formation which signaled an upcoming price increase. This recent price hike from the $380 levels to the current $420 validated the technical indicator:

Chart from bitcoinwisdom.com

An interesting observation worth taking note of is the relation between the amount of active users on Bitcoin’s most popular subreddit r/Bitcoin and Bitcoin’s price. This chart from cryptocompare showcases a potential relationship:

Chart from cryptocompare.com

We can see a subtle pattern where the amount of active reddit users rises as bitcoin’s price climbs. Furthermore, we can see on Feb 09 that the amount of active user’s reached a peak last seen Jan 28th. This peak seemed to be a foreshadowing for the rally which began the same day. The amount of active users on a subreddit alone should not be the basis to make a decision on a trade, however it is important to take that data into account as there is a relationship with the market.

Looking at the current 3 day chart we can see yet another head and shoulders pattern forming. As we mentioned earlier the last H&S validated itself with this price rally, however will this new formation hold true and send Bitcoin to new highs?

Potential targets to watch out for is the $417 support line. If the head and shoulders doesn’t hold the market may collapse, but first it will test support. On the upside, if the head and shoulders validates then we may see new highs of up to $450.

Another interesting technical indicator to watch out for is the Death Cross. a golden cross is when a long term moving average of a security crosses over with a different short term moving average of the same security.

The Death Cross technical indicator indicates a major bear market ahead. In Bitcoin we can see this death crossover approaching only if bitcoin’s price stops rising. The red lines are speculative lines which show that if bitcoin’s price doesn’t keeps rising at a modest rate the 200MA will crossover with the 100MA forming the death cross.

Do you think Bitcoin’s price will keep on rising and form the death cross, or do you think the bulls will keep their momentum and bitcoin will see new highs? Take a moment to vote in the poll below on whether or not you think Bitcoin’s price will keep on rising and see how other’s voted.

[interaction id=”56c69e66b6c51fb652f10c58″]

If you liked this article follow us on Twitter @themerklenews and make sure to subscribe to our newsletter to receive the latest bitcoin and altcoin price analysis and the latest cryptocurrency news.

Disclaimer: This is not trading advice