Historically accurate 'momentum indicator' hints at possible Bitcoin breakout ahead

Bitcoin (BTC) could see a “massive bullish move” if a classic trigger from the 2021 bull run repeats this week.

In a tweet on Dec. 16, on-chain analyst Matthew Hyland, known by the Twitter handle Parabolic Matt, drew attention to Bitcoin’s momentum indicator.

Momentum indicator hints at potential "massive bullish move"

While still under $50,000, Bitcoin has already broken out of a long-term downtrend on the momentum indicator, which measures closing prices against those from a period in the past.

Two such breakouts have occurred this year, and after each one, BTC/USD went on to see considerable upside.

“The previous two times it broke out of a multi-month downtrend this year, a massive bullish move followed,” Hyland wrote as part of comments.

Historically accurate 'momentum indicator' hints at possible Bitcoin breakout ahead
BTC/USD vs. momentum indicator annotated chart. Source: Matthew Hyland/ Twitter

While not a guarantee of “up only” price action, the momentum data joins a large number of on-chain metrics flashing bull signals this month — a list that keeps growing.

Hyland is known for his highly optimistic price forecasts, and last month caused a stir by predicting that Bitcoin would hit $250,000 in January 2022 while invalidating one of the popular stock-to-flow price models.

#Bitcoin bottom structure on the RSI and Momentum indicators (daily time frame) look very similar to what occurred in September before the reversal up started•Momentum has broken out•RSI needs a close above resistance to confirm breakout

•Bitcoin price waiting to breakout pic.twitter.com/XDwiUsSj2U