The Bitcoin price is precariously moving along the bottom of its 4-month bear flag. A crash looks likely. Can anything still save the day, or are we about to witness the last bottoming stage of this Bitcoin bear market?
Small bear flag breaks down
Source: TradingView
The 4-hour time frame reveals just how perilous the situation is for the $BTC price right now. After reaching the bottom of the 4-month long bear flag towards the end of last week, the price then went into a consolidation phase that took the form of another small bear flag. As can be seen in the chart, that tiny bear flag has just broken to the downside, with the resulting breaking candle coming directly down to a convergence of the bottom of the big bear flag and the $77,760 horizontal support level. The new 4-hour candle has just opened below the bear flag bottom, but is holding the support level so far. It appears the $BTC price has arrived at a do-or-die point for the bulls and the bears.
100-day SMA support about to fail?
Source: TradingView
The daily time frame reveals the bear flag in its entirety, and shows that the $BTC price may be about to break, and then possibly confirm, below the 100-day SMA.
As previously mentioned, the small bear flag that has formed at the bottom trendline of the big bear flag is breaking down. The measured move out of the bottom of this small bear flag would be to around $68,700, which is just below the good horizontal support at $69,000.
At the bottom of the chart, the RSI indicator line is inside a descending channel. If a crash gets underway, the bottom for this indicator line may coincide with the $BTC price reaching the last decent horizontal support before the bottom at $66,000.
Measured move down to $44,700?
Source: TradingView
The weekly chart illustrates that the writing is on the wall. Yes, there still could be a bounce from the bottom of the bear flag which corresponds with a good horizontal support level at $72,700, but the truth is that the $BTC price is in a bear flag, and these normally break to the downside.
In addition, if you compare this bear market with previous bear markets, timewise there is still some way to go – probably out until Q4 of this year.
Therefore, with the Stochastic RSI indicators now passing down through the important 80.00 level, and heading back to the bottom, all would appear to be set for the next downward leg of this bear market.
Taking a measurement from the top of the previous bear flag down to the bottom of this one, and then transferring this measurement to the top of this bear flag, the full measured move out of this bear flag would be all the way down to $44,700. This would be a 46% crash, translating to a wipeout of $38,000 from the top of the bear flag.
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.
