Digital Marathon Rises Higher Than Bitcoin, Crypto Sector Holds Flat: What's Happening?  - Marathon Digital Holdings (NASDAQ: MARA)

Digital Marathon Rises Higher Than Bitcoin, Crypto Sector Holds Flat: What’s Happening? – Marathon Digital Holdings (NASDAQ: MARA)

Marathon Digital Holdings, Inc Mara It rose more than 6% after the market opened on Thursday before meeting a group of sellers. The arrow was Bitcoin Bitcoin / US Dollarwho was trading near a flat.

The cryptocurrency market has shown relative strength against the general markets over the past few weeks, holding steady or moving slightly higher while the S&P 500 is trading in a confirmed downtrend on the daily chart.

Crypto miners like Marathon Digital are influenced by both the crypto sector and the general markets. With Bitcoin showing strength, Marathon Digital is up over 42% since September 23rd, but on Thursday the stock was rejecting a higher trend line due to weakness in the general market.

The upper trend line may be the neckline of the inverted head and shoulders pattern. An inverse head and shoulder pattern can be either a strong reversal indicator when found at the bottom of a downtrend or a continuation pattern that is in an uptrend.

The pattern is formed when the security forms a rounded or V-shaped bottom and then rises (right shoulder) followed by a second deeper contraction and attendant high (head) then a third low and a lower deep rise than the second (left shoulder).

The inverted head and shoulder pattern has a neck line, which is drawn using a straight upward, descending or horizontal trend line through the tops of the pattern.

When the security breaks through the neckline at above average trading volume, this indicates that the pattern has been identified and a rally may follow.

  • Aggressive bullish traders may choose to enter a security in a head and shoulders pattern on the upside after the third low, with a stop below the bottom price. More conservative traders may wait to enter a trade on the breakout from the neckline.
  • Bearish traders may wait to enter into a position if the security breaks below the lowest price within the second bottom, which negates the bullish head and shoulders pattern and indicates the possibility of an accelerated move to the downside.

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Digital Marathon Planner: The head and shoulders pattern in Marathon is not confirmed because the right shoulder is not completed. If Marathon Digital continues to reject the pattern’s potential bearish neckline, traders and investors can watch for a circular bounce, which could lead to the creation of a second shoulder.

  • If that happens, the marathon could reverse into a strong uptrend. Regardless, if the stock breaks off the trend line on above average volume, an uptrend on the weekly chart may be in the cards.
  • The marathon is already trading in an uptrend on the daily chart, with the last higher low formed on Oct 3 at $10.39 and a recent confirmed high of $11.83 the previous day. If the marathon closes the trading day with a candle with an upper wick, the next higher rally may have occurred, making it more likely that the stock will trade lower on Friday.
  • Marathon has higher resistance at $14.56 and $19.51 and support below at $9.93 and $7.79.

See also: Bitcoin, Ethereum Edge Higher and Dogecoin Slips: Analyst Says Apex Coin Fundamentals “Continuing to Support Healthy Consolidation”

Image via Shutterstock.

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