Is Bitcoin Entering A New Bullish Trend?
If you’ve been waiting for a clear sign that the bulls are back in control of crypto, you might have it. After several attempts to break through the $38,000 resistance, Bitcoin’s price is showing some weakness. This could be good news for bears and confusing for bulls. But technical indicators like the Average Directional Index (ADX) can help remove the noise and emotion from decision-making.
Bitcoin’s Bullish Trend Official
The ADX has now confirmed the bullish trend with a reading above 20. The last time this happened was in August 2020, right before a significant rally of over 450%. While history doesn’t always repeat itself, the rise above 20 on the ADX is an encouraging sign.
Using The ADX To Gauge Crypto Trends
The ADX is a trend strength measuring tool created by J. Welles Wilder, Jr., who also developed other technical analysis indicators. An ADX reading above 20 indicates an active trend, while readings below 20 suggest weak trends and potential sideways price action. Additionally, the DI+ and DI- indicators show which side of the market is controlling price action.
Are Bulls Stronger Now Than Before?
Bulls are currently in control with a DI+ reading of 36, stronger than during the last significant rally in August 2020. This could be an indication that there is more room for growth this time around.
The chart was originally featured in Issue #27 of CoinChartist VIP: The Ethereum Issue. You can check out the latest issue for free here.
Hot Take: Signs Point To Another Bitcoin Bull Run
If you’re still skeptical about another big Bitcoin bull run happening so soon, it’s understandable. However, technical indicators such as the ADX are signaling a new bullish trend emerging. With bulls appearing to be stronger now than they were during previous rallies, it might be time to start paying closer attention to crypto markets.
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