Despite everything that’s been thrown at it, and in spite of some fairly appalling market sentiment, the Bitcoin price is still hanging in there. Is this just a pause in a bear market plunge, or is a bottom forming that will eventually act as a springboard back to the highs?
Market expecting a further dump?
Another dire reading in the crypto Fear and Greed Index, which is once more hovering in the depths of Extreme Fear, is accurately reflecting the market sentiment on Bitcoin. It seems that the vast majority of traders and investors are expecting a further dump – one that will confirm the bear market, and one that could take the $BTC price down to $74,000 to $69,000 – the top of the previous bull market.
An possible ascending triangle begins to appear
Source: TradingView
Viewing the $BTC price in the 8-hour time frame one can see an interesting development. When the price bounced after the latest reversal, it did so from a new ascending trendline that has now been confirmed. If this trendline continues to hold and the price climbs upward, it would appear that an ascending triangle would be playing out.
This particular pattern normally breaks to the upside. A measured move if it does lead to a breakout could take the $BTC price to around $108,000.
Patience needed to allow bottoming process to play out
Source: TradingView
The daily time frame for the $BTC price makes things quite clear. Either the price holds above the major trendline, or it doesn’t, and things become very scary for Bitcoin holders.
Many are probably thinking that the current failure of the $BTC price to get above the previous horizontal resistance level at $94,000 means that this is just a relief rally, and that the next leg to the downside is probably on its way.
This said, if one just looks left at the bottoming price action of the previous falling wedge, it can be seen that this took a lot longer – 47 days to be precise. This current bottom is only into its 24th day so far, so only half way in comparison to the previous falling wedge.
However, this correction is bigger – 36% compared to 32%. Also, the current breakout occurred at a roughly similar point in the wedge.
The market has seen this move play out before
Source: TradingView
The weekly chart shows that a breakout is occurring from the falling wedge. If the price had a big job to stay above the downtrend line last week, this week it is so far completely free of the trendline.
The $90,000 level is an important horizontal resistance to definitively break this time. If this can occur, the $BTC price should be drawn up to the $94,000 resistance level. If, however, the price baulks at this level, there is a tiny amount of play left between the major ascending trendline and the resistance. The price has to go one way or the other – and soon.
The Stochastic RSI indicators at the bottom of the chart are perhaps showing the beginnings of a possible roll over. If they do in fact come back down, the price could fall below the major trendline. On the other hand, they might form a little kink, just like they did at the bottom of the previous falling wedge, but they eventually straightened up and the price went to an all-time high.
When all is said and debated, the current bottoming process is probably just a repeat of the previous bottoms for the last two big patterns. The Stochastic RSI also has a lot in common this time. Trading and investing was never easy, but on this high-time scale, it’s probably just a case of waiting for the market to play the move out.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.