Key Points
- Bitcoin (BTC) has demonstrated a bullish flag pattern which may suggest a potential surge in its value.
- Despite strong support above $60,000, a dip below this mark could still occur before any significant rally.
Bitcoin (BTC) has exhibited a bullish flag on its daily chart. This is a technical chart pattern typically associated with a strong upward momentum for the asset. This might be an indication of the commencement of the post-halving bull run.
Bitcoin’s Bullish Momentum
On April 26, the daily chart of Bitcoin displayed a bull flag pattern. This was noted by prominent cryptocurrency analyst Mikybull. Mikybull stated that Bitcoin is forming a bull continuation pattern on a daily chart. According to the Wyckoff’s law of cause and effect, the longer the consolidation, the more explosive the markup will be.
Denis Baca, a financial analyst and head of product at Zivoe, claimed that the current chart formation is a strong bullish setup. He suggested that the bull flag on Bitcoin’s daily chart historically indicates more upside. After a solid rally, the declining volume indicates a pause before potentially shooting towards $100,000.
Potential Hurdles for Bitcoin
However, Andrey Stoychev, the head of prime brokerage at Nexo, expressed that Bitcoin is unlikely to rally higher in the absence of a significant catalyst. After testing $64,000 more than once on the day, Bitcoin does signal the potential for a further climb upward. Despite this, any significant price rises could remain unrealized. Bitcoin may merely reach the upper bands of the established trading range of around $67,000.
According to Coinglass, traders should monitor the $65,000 Bitcoin price level. A move above this level could liquidate over $500 million worth of cumulative leveraged short positions.
While Bitcoin has seemingly formed strong support above the $60,000 mark, Baca suggested that a potential dip below this level could still occur before rallying to new highs. He stated that going into May, Bitcoin could fade to retest the support of the 20-week SMA, which would put Bitcoin at $56,000. Such a move would be healthy before going higher.
Stoychev, however, doesn’t expect Bitcoin to fall below $60,000, unless U.S. interest rates remain high for more than expected. He expressed that unless there is a long period of high interest rates affecting sentiment towards digital assets for the remainder of 2024, it’s unlikely that Bitcoin will retrace that far back.
If Bitcoin price potentially falls below $60,000, it could liquidate over $1.4 billion worth of cumulative leveraged long positions, according to Coinglass.