Bitcoin’s price has been experiencing a period of stagnation after dropping from the $75K level. Many view this as a bearish reversal, but upon closer inspection, the momentum appears to be shifting. The BTC price has been moving within a descending channel pattern, forming lower highs and lows. However, the $60K support zone has managed to hold the price on multiple occasions. This indicates that the market may be gearing up for a breakout above the channel, signaling a potential bullish trend. On the flip side, a drop below this pattern could lead to a rapid decline towards the $52K support level.
Taking a closer look at the 4-hour chart, we see further evidence to support the bullish outlook. The price has recently rebounded from the $60K support zone and is currently testing a short-term resistance level around $63,500. Additionally, the Relative Strength Index has crossed above the 50% mark, suggesting a shift towards bullish momentum. With the potential breakout above $63,500, the price could rally towards surpassing the midline of the channel. This scenario sets the stage for a possible surge towards new all-time highs.
While many search for reasons behind the correction in Bitcoin’s price, a closer look at the US market offers some valuable insights. The Coinbase premium gap measures the variance between Coinbase’s BTC/USD pair and the BTC/USDT pair on Binance. By comparing demand and supply in the US market with other countries, this metric provides a unique perspective. Recently, the Coinbase premium gap has shown significant volatility, particularly on the downside. The selling pressure from US investors, particularly wealthy individuals and institutions, has contributed to the downward trend in Bitcoin’s price. As long as this trend persists, the chances for a bullish continuation remain slim.
Despite the current price stagnation, there are indications that Bitcoin may be gearing up for a bullish wave. The patterns on the daily and 4-hour charts, coupled with insights from the US market, suggest that a breakout above key resistance levels could pave the way for a significant price rally. While the bearish sentiment prevails, investors should consider the possibility of a trend reversal in the near future.