An analyst has explained that Worldcoin is currently showing a breakout from a pattern that could potentially lead to a rally of 80% for WLD.
Worldcoin Appears To Be Showing A Bullish Breakout Currently
In a new post on X, analyst Ali shared a chart for the 4-hour price of Worldcoin, which shows the formation of a bull flag for the cryptocurrency. A "bull flag" is a continuation pattern in technical analysis that, as its name suggests, looks like a flag on a pole.
Bull flags form when a rapid uptrend in the price slows down and reverses in the opposite direction while consolidating inside a specific channel. The preceding uptrend forms the "pole," while the channel shapes up the "flag."
There are also bear flags, which form during periods of downtrend instead. The downward trajectory naturally forms the pole in this case and the flag corresponds to the consolidation towards a slight upside.
In the context of the current discussion, the normal bull flag isn't of interest, but rather a variant often called a "pennant" is. The usual bull flag forms when the consolidation happens between two parallel levels, while a pennant observes the asset moving between converging lines.
Here is the chart posted by the analyst that reveals this pattern recently forming in the 4-hour price of Worldcoin:
The price appears to have been breaking out of the pattern recently | Source: @ali_charts on X
In this pattern, the top line is created by joining together lower highs, while the bottom line connects lower lows. Typically, the asset is probable to feel resistance at the upper level, while the lower level could act as support.
A break beyond either of these lines can signal the continuation of the trend. From the chart, it's visible that the 4-hour Worldcoin price had been consolidating inside the pennant channel just recently, but has now seen a break, as its price is surging above the upper level.
Such a bullish breakout has generally led to strong uptrends in the past, with the length of the resulting uptrend often being comparable to the pole of the pattern.
The break has only just started to form, though, so a more sustained uptrend will have to be seen first to see if the pattern has truly taken place. "If confirmed, this could pave the way for WLD to enter an 80% rally, targeting $6.30," says Ali.
WLD Price
Worldcoin had broken off toward the $4 level earlier in the past day, but the asset has quickly cooled off as it has already receded to the $3.7 mark. The below chart shows how WLD has performed during the last few days.
Had this pullback not taken place, the bullish breakout may well have been confirmed. The coin would have to show some fresh momentum again now if the pattern has to complete.
Looks like the asset's recent upwards push was quite short-lived | Source: WLDUSD on TradingView
Featured image from Shutterstock.com, charts from TradingView.com
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
Source: NewsBTC.com
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