Steem is currently trading above the resistance level of a common bullish pattern -- the ascending triangle (highs occur near the same level with lows occurring at higher and higher levels along a trend-line). The question is: is this a valid breakout? Are we about to witness another price explosion in Steem?

Let's have a look at it and try to find out.

Hourly Candlestick Chart for STEEM/BTC at Poloniex Exchange:

---

https://www.tradingview.com/x/Z5vARpQm/

---

First things first, the ascending triangle is highlighted on the above chart as the sloping solid blue line and the horizontal dotted blue line. The pink, blue, and red lines that are under the most recent candle are the 200, 100, and 50 simple moving average(s) (SMA), respectively. The dotted red line (extended from the 200% level, from the width of the ascending triangle) marks the traditional target level of an ascending triangle breakout, while the 161.8% level is my usual target for these types of breakouts (has a much higher success rate).

I obviously can't say for sure whether this is a legit breakout, or a false breakout, like the candle that threw out a wick above the resistance level on the 15th of May (the wick is circled on the chart and filled in with red), but I can tell you that the odds are better this time around that this is a real breakout, or that a breakout is imminent if this one happens to fizzle out as well.

Why do I say this?

Three reasons:

1.) the 50 SMA is much closer to the area of the breakout, meaning the momentum of the last 50 hours is more favorable to a strong upward move than it was on May 15th.

2.) the 100 SMA is nearly level with the 50 SMA, creating a "double moving average support" at that level, also signifying that the momentum of the last 100 hours supports a bullish bias. More importantly, the room between these moving averages and the resistance line of the ascending triangle are closing into a small area. Price has little room to drop before gaining the support of these moving averages and, this is an important point to pick up on, price has recently received support from testing them on May 18th (getting a good bounce out of those tests).

3.) The moving averages are lined up perfectly for another leg up in price, with the 200 SMA sitting right below the 100 SMA and the 100 SMA sitting right below (nearly on) the 50 SMA. This is the type of moving average set-up that we usually see at the start of significant upward price moves. It means that the market momentum is lining up between the short (50), medium (100), and long-term (200) look-back periods.

So, while I can't guarantee that this is a legit breakout or that it will happen in the next couple of days if this one happens to fail, I can say that the chart says an upside breakout in the next couple of days is the favorable bet.