Bitcoin has now spent the last 10 days around the top of its bear flag. While a breakout is still a possibility, with perhaps a surge to as high as $85,000, a pullback to at least $74,000 could be loading. This bull/bear battle is likely to decide whether this bear market is going to persist.
Bulls running out of time?
Source: TradingView
The short-term time frame for the $BTC price reveals that things are about to come to a head. The price has been bumping along the $77,700 support/resistance line since last Thursday, and early on Monday, rose to retest the top of the bear flag again. As can be seen a fairly strong rejection was the result, and the price is once more back at $77,700.
Time is now becoming a concern for the bulls, given that the price is funnelling into a tight space between the top of the bear flag and the ascending trendline. This is forming an ascending wedge pattern, which is bearish. The probabilities are more towards a breakdown through the ascending trendline than a breakout of the bear flag, and whichever of these scenarios happens, it should take place soon.
At the bottom of the chart, the Stochastic RSI indicators are just turning back down, adding to the likelihood that this will be a breakdown.
Ascending wedges with probability of breaking down
Source: TradingView
In the daily time frame it can also be seen that if the bulls are going to push on and perhaps claw their way out of this bear market, now is most certainly the time. A surge out of the top of the bear flag would be extremely bullish, given that these formations usually break to the downside.
However, the evidence in the charts is probably pointing more towards a breakdown than a breakout as already mentioned. As well as an ascending wedge in the price action, there is also one forming in the RSI. If one of these breaks, the other will surely follow.
One last big bullish effort, or a collapse to come?
Source: TradingView
The weekly time frame shows that this surge for $BTC has added around $13,000 to the price in just four weeks. Is this the end of it, or is there one last big effort to come?
It’s only the beginning of the week, but the new candle has already taken on a bearish look. If the bulls are still to pull something out of the hat, they will need to make the $78,000 level new support, which along with $80,000 is the main resistance band until $90,000. Closing this week below this band would probably be a confirmation of the dip to come.
At the foot of the chart, the Stochastic RSI indicator lines are approaching the top. If they can hold above the 80.00 level for a while, there is still hope for the bulls. However, if they roll over and start to come back down, a collapse could already be in the process of developing.
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.