Looking at the Bitcoin 4 hour chart, and based on technical analysis, I’m calling an imminent breakout in the next 24 hours. This is not a difficult prediction to make, since bitcoin has been trading sideways for the past two weeks now.

The recent parabolic pump in price stalled on 30 November, around 9 days ago, as I write this. Price then began to trade sideways, although it did make one last push upwards on 1 December, to break the ATH (all time high), stopping within a few dollars of the big even psychological resistance of $20k.

Reason 1: If we look at the 4 hour chart, we can see the symmetrical triangle that has formed in price action since then. Price is now approaching the end of that triangle and so the breakout is theoretically approaching. It’s likely sooner rather than later. The symmetrical triangle is a continuation pattern, and since we have been in a major bull trend, one would assume that the breakout will be to the upside.

However, I am not going to call it either way but rather follow the chart and wait for a breakout to confirm. In this business it’s better to let the chart show us, and re-act as opposed to pre-act.

Reason 2: Volume is decreasing, as you can see on the chart. This is a good sign and is not unusual just before another breakout.

Reason 3: The 10, 20 and 50 MAs (moving averages) are tightly converging right now, as I write this. In my experience, when we get such a bunching of three or more Mas, it can indicate a point of breakout. So it could have already occurred by the time you read this.

Wait for price to actually break out of the symmetrical triangle to see which way we are heading. There are, of course, always possible false breakouts, or bull trap/bear trap breakouts. Therefore, if you want to play it safe, then watch the breakout, then watch for the retrace back to the triangle trend line, and then watch for price to again move in the original breakout direction once more.

Also, if we look at the RSI in purple at the very bottom of the chart, we can see that it has dropped below the middle 50 mark, and this is bearish for me.

Oh wait... as I write this the breakout has occurred to the downside. Is this it? The target is measured by taking the width of the triangle at its opening or largest side, and measuring it down to the target. In this case it comes to around $17 000. Previous lows are around $16 500 so the target could be anywhere in that range. I would put in a sell or go short, and place two targets, for a TP (take profit)1 at $17k and TP 2 at $16 500.

This is, of course, merely my opinion and not investment advice. Let’s watch and see how it plays out now, in coming hours.