Bitcoin’s sojourn inside a 9-week long bear flag may be coming to an end. There is the possibility of one more week inside the flag, but with the bear market trendline bearing down on the $BTC price, room is fast running out, and either the bulls will force the breakout, or the bears will tighten their grip.
$BTC closes in on 7-month trendline
Source: TradingView
The short-term time frame chart above shows that the $BTC price is attempting to maintain above the $71,400 support. If it does so, it is a very short climb up to the descending bear market trendline, and just beyond that, the strong $74,000 horizontal resistance level.
The question is not if the price will reach and retest the descending trendline, it’s whether the bulls can keep the momentum going when the price gets there. Having entered the 7th month of this downtrend, it needs to be seen if now is truly going to be the time when the downtrend is broken, and Bitcoin starts to climb again.
A big move is building
Source: TradingView
The daily chart illustrates the two bear flags, and how close the $BTC price is to retesting the bear market trendline. That said, it can also be seen that even if the trendline is broken, the bear flag remains active until the price gets a good way above $80,000.
At the bottom of the chart, the volume profile is tapering down. This probably means that a big move is building. In the RSI, the indicator line is still below the downtrend line. Either a rejection or a breakout are brewing. This is becoming a very close call.
$BTC about to break out in weekly time frame
Source: TradingView
The weekly chart reveals the $BTC price practically at the end of the bear flag, at least as its bottom is concerned. If we compare the two flags now, they are both 10 weeks in. In fact, the price was already dropping out of the first bear flag at this point in time. With 3 days to go, the price in this current bear flag is looking to head in the opposite direction. Will this still be the case when the weekly candle closes this coming Sunday?
There does appear to be the possibility of one more candle in this bear flag, but if the bulls can just hold the price around this level for that Sunday close, the next candle will open on the other side of the descending trendline, giving the bulls a real boost.
The RSI in this high time frame is a more reliable guide, and it is showing that the indicator line is nicely above the downtrend line. This setup will also need to hold into the end of the day on Sunday. Look how the price rocketed each time the downtrend line was broken previously.
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.
