Bitcoins (BTC) long and difficult Summer about to come to an end
This Summer has not been particularly fruitful for the Bitcoin price. Six months of long, grinding, sideways and downwards price action has made it difficult for investors to stay positive. However, a wind of change is blowing across markets. Upward price momentum is potentially on the way.
Spot Bitcoin ETFs were the catalyst for the all-time high
The Spot Bitcoin ETFs were a huge boost to the Bitcoin price, and theres no denying it. This had the effect of putting the turbo chargers under the price of $BTC and pushed the price to its new all-time high at $73,800.
Many were expecting the price momentum to continue once it got there, given that the institutions appeared to be enamoured with an asset that was outperforming the market by miles.
What goes up must come down
However, it doesnt matter which asset it is, it cannot just keep on going up in a straight line. Gravity beckons eventually, and this came in the form of technical macro indicators that were signalling that the king of the cryptocurrencies had finally topped out.
Therefore the downward grinding price action began. It wasnt all grinding, and in fact, a lot of the ups and downs were quite volatile, but the main downward trajectory had begun, and the lower highs and lower lows began to stand out.
The bull flag
That said, a huge price surge, followed by a series of lower highs and lows, generally means one thing in technical analysis - a bull flag. The Bitcoin price has been tracing out a 6-month long bull flag, and this will have to break soon.
Bull flags generally break out to the upside. That said, there is much debate on the structure of bull flags, and some are saying (like renowned trader Peter Brandt) that the flag has gone on for too long, and therefore it is not valid.
If on the other hand this is a bull flag, the percentage chance of an upside breakout is 85%. Also, if this bull flag is valid, a measured move would give an upside target of $86,000, or $100,000, depending on where the beginning of the flagpole is measured from.
Macro technical indicators have the final say
Finally, just as technical indicators, rather than financial indicators, signalled when the top was in for Bitcoin, they will have the same say on when the Bitcoin is in. Given that these are lagging indicators, it may be that the bottom has already been found.
Source: TradingView
The above weekly chart shows the bull flag. Below are the Stochastic RSI, and the Relative Strength Index. The Stochastic RSI is showing that the two indicator lines, although pointing down, are very near the bottom. When these two lines cross back up, some big upward momentum should start pushing the price up.
The Relative Strength Index is also a momentum indicator, and it can be seen that the price has bounced from a historically strong level at 45. If the indicator line can break through the descending trend line, this would also signal strong momentum, and a change in trend once it makes a higher high.
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.
Read more: https://cryptodaily.co.uk/2024/09/bitcoins-btc-long-and-difficult-summer-about-to-come-to-an-end
Text source: Crypto Daily™
