Tesla’s Bitcoin Move Provides Tailwinds to Bullish Triangle Pattern

Key Bitcoin Points

  • Bitcoin surged higher on Wednesday as investors digested a new announcement from Tesla.
  • The US carmaker said that it has started accepting cryptocurrency as payment for its vehicles.
  • BTC/USD stayed on course to break above its descending triangle pattern.
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Bitcoin pared its losses from the overnight US session Tuesday as investors’ focus shifted on Tesla’s latest crypto move.

The US carmaker added a bitcoin payment option on its US website earlier Wednesday. Founder Elon Musk took the news to his social media handles, announcing that the company now uses internal and open-source software while operating Bitcoin nodes directly. The entrepreneur further confirmed that Tesla wouldn’t exchange its crypto earnings with fiat currencies.

“Pay by Bitcoin capability available outside [the] US later this year,” he said.

Traders reacted positively to the Tesla news. Bids for the benchmark BTC/USD instrument started rising shortly after Mr. Musk’s tweet went viral. The pair breached $57,000 during the early New York trading session but pared a small portion of it daytraders secured their profits.

Descending Triangle

In doing so, Bitcoin also tested its 50-4H moving average (the blue wave in the chart below), with additional downside pressure coming from a falling trendline slope just above. The trendline constituted a Descending Triangle that traders consider a bullish continuation pattern during an asset’s uptrend.

Bitcoin, cryptocurrency, BTCUSD, BTCUSDT

Bitcoin trades inside a bullish continuation pattern. Source: BTCUSD on TradingView.com

Optimistic fundamentals led by Tesla’s announcement, coupled with the Descending Triangle formation, promised further upsides to BTC/USD. Should a breakout follow suit, the pair faced the prospect of rising by as much as the Triangle’s maximum height. That meant a $66,000 Bitcoin in the short-term.

Meanwhile, an upside rejection risked a decline towards the Triangle’s lower trendline support at $53,000. A breakdown and traders could have their short targets extended to the lower $50,000s.

“54k has been a very pivotal level, and Bitcoin has held it once again, following the sweep of the low,” said TraderKoz, an independent market analyst. “Still think we get a move up to Monday’s high from last week. Any dip to around 55k would be a long, in my opinion.”

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