On Monday, Bitcoin (BTC) appeared to be emerging from the downtrend in force since the all-time high back in October. However, it wasn’t to be. Yet another rejection means the downtrend persists. Is this just a case of the bulls having to remain patient, or could a major breakdown still take place?
Bears force the $BTC price back under the trendline
Source: TradingView
The 4-hour time frame shows how the $BTC price emerged from the downtrend line on Monday, but also how a strong red candle took the price back beneath later in the day. The bulls are certainly pounding against the downtrend, and the probabilities are that they will break through definitively at some point – and that should be within the next several days.
It can also be seen that a clear ascending channel has formed, which could help to guide the price higher. If the bears do throw another wrench into the works, the bottom of the channel, as well as the major ascending trendline, would likely provide good support.
So now it’s a case of waiting for that eventual breakout, or the possibility of a stronger rejection that takes the price back down to the major trendline. Time is counting down for either scenario to take place.
Price reaching the end of giant falling wedge
Source: TradingView
The daily chart allows one to observe the large falling wedge that the price is within. While this wedge is not as long timewise as the 8-month bull flag from March to December 2024 (204 days compared with 237), it is still huge, and is much bigger than the previous wedge.
It can be seen in the chart that the price is unlikely to come down to the full extent of the wedge given that the major ascending trendline cuts off the last part of it, and the price has been respecting this so far. However, if the price falls through the major trendline, the rest of the wedge comes into play.
At the bottom of the chart, the RSI reveals that the indicator line is traversing up nicely from the bottom. An ascending trendline is taking shape, and the bulls will be hoping that the price continues to bounce from it.
$BTC about to break out of third huge pattern
Source: TradingView
The weekly time frame illustrates the three major bullish patterns so far in this bull market. The long bull flag, followed by two big falling wedge patterns. Is there another big pattern still to come? Or could it all end here as the price falls through the major trendline and out of the bottom of the current falling wedge?
The probabilities are in favour of the bulls here. It would take a huge black swan to send Bitcoin down and into a bear market from this position. As things stand, the likelihood is that the price does break out to the upside, and possibly rises all the way back to retest the 8-year trendline. Beyond this, nothing is certain. This could either become the blow-off top, or the bull market could continue on if the price breaks through.
At the bottom of the chart, the MACD reveals that the blue indicator line is starting to curve into a more gentle descent, while the pink histogram bars are continuing to reduce in size. The trend is changing.
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.
