The Bitcoin, Ethereum And Dogecoin Setup Into The Weekend After FTX Mess, CPI Data, This Bullish Pattern By Benzinga
© Reuters. The Bitcoin, Ethereum And Dogecoin Setup Into The Weekend After FTX Mess, CPI Data, This Bullish Pattern
Benzinga – (CRYPTO: BTC) swung wildly between 9 a.m. and 10 a.m. after news hit that cryptocurrency platform FTX had filed for bankruptcy.
The volatility caused (CRYPTO: ETH) and (CRYPTO: DOGE) to follow suit.
Between 9 a.m. and 9:30 a.m., Bitcoin plunged more than 5% before spending the following 30 minutes rebounding almost completely up to the $17,267 level. Since then, Bitcoin has been consolidating the volatility on smaller time frames, settling into a tightening range on the 15-minute chart.
Meanwhile, FTX founder and now former CEO Sam Bankman-Fried announced his resignation from the company. He will be replaced by John Ray III, who some reports say is the same person who oversaw the Enron Corporation bankruptcy.
Read more about Sam Bankman-Fried’s FTX debacle here.
The news comes as a disappointment after consumer price index (CPI) data released by the U.S. Bureau of Labor Statistics on Thursday morning showed inflation ticked lower in October, coming in at 7.7% versus the 8% estimate.
The news provided momentum to the crypto sector and boosted Bitcoin up from its almost two-year low. Ethereum and Dogecoin rebounded in unison during Thursday’s 24-hour trading session, spiking up 17% and 20%, respectively, from the Wednesday lows.
Despite the downturn during Friday’s 24-hour trading session, Bitcoin, Ethereum and Dogecoin remain trading in an inside bar pattern on the daily chart, which leans slightly bullish because Friday’s candlesticks are printing near the top of Thursday’s ranges.
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The Bitcoin Chart: Bitcoin was printing a double inside bar on Friday, with all the price action of the last 48 hours taking place within Wednesday’s trading range.
On smaller timeframes, Bitcoin’s range has been lessening, which indicates a break up or down from Wednesday’s mother bar could come over the weekend.
There’s a chance that Bitcoin could continue trading in inside bar patterns and eventually set up a bear flag pattern, with the pole formed over Tuesday and Wednesday and the flag forming since then. If the pattern is recognized and Bitcoin breaks down from the flag on higher-than-average volume, the measured move is about 23%, which suggests the crypto could fall toward $14,000.
If Bitcoin breaks up from Wednesday’s mother bar on higher-than-average volume, the potential bear flag will be negated because the crypto will regain the eight-day exponential moving average (EMA) as support. If that happens, Bitcoin may find the next resistance level at the 50-day simple moving average (SMA).
Bitcoin has resistance above at $17,580 and $19,915 and support below at $16,000 and $15,000.
The Ethereum Chart: Like Bitcoin, Ethereum is trading in a double inside bar pattern. Ethereum is also holding above an important descending trendline on the daily chart, which the crypto broke up from on Oct. 25, which is bullish.
Ethereum was working to print a hammer candlestick on Friday, with a substantial lower wick. This indicates there are buyers under the $1,250 level and makes a break up from the inside bar more likely.
Ethereum has resistance above at $1,412 and $1,717 and support below at $1,245 and $1,081.
The Dogecoin Chart: Dogecoin is trading in a single inside bar pattern and holding above the 200-day SMA, which the crypto regained Oct. 28. When a stock or crypto trades above the 200-day SMA, it’s considered to be in a bull cycle.
If Dogecoin continues to trade above the 200-day over the weekend, the 50-day SMA will cross above the 200-day, which will cause a bullish golden cross to form. If the crypto is unable to break significantly up from the inside bar pattern, however, the eight-day EMA will cross under the 21-day EMA, which could add further pressure from above.
Dogecoin has resistance above at $0.083 and $0.099 and support below at $0.075 and $0.065.
Photo: SvetlanaParnikova via Shutterstock
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