Amid the ongoing recovery in the crypto market, the Bitcoin price has witnessed an upright rally and breached the resistance trendline of a two-month-long bullish pattern, called megaphone. This breakout should accelerate the buying pressure in the market and bolster buyers for a further price rally to the $30000 mark. However, the technical chart hints a temporary correction is possible before BTC begins the next bull cycle.
- BTC Price Analysis Hints at a potential pullback to $25000, registering a 7% downfall
- A potential bullish crossover between the 100-and-200-day will accelerate the buying momentum in the market
- The intraday trading volume in Bitcoin is $31 Billion, indicating a 25% loss
Market Sentiment and Fundamental Analysis
The ongoing U.S. bank crisis has created distrust of investors toward the banking system and has shifted theirs to the crypto market. Bitcoin is now viewed as a safe asset during times of crisis, offering a hedge against falling dollar values and risky assets.
As a result, Bitcoin and the majority of major altcoins witnessed significant growth since last week, creating a sense of recovery among market participants.
However, such an explosive rally in a short time is considered unhealthy for a sustained price trend, and therefore a possibility of temporary correction is plausible
As per a recent post from Cryptoquant, the Bitcoin on-chain data project that the BTC exchange inflow is increasing. The behavior of holders moving their assets to crypto exchanges is typically seen as bearish since it raises the likelihood of them selling their holdings.
Bitcoin Price Analysis(Daily Chart)
Over the last two months, the Bitcoin price witnessed a highly volatile and unclear trend. During the consolidation phase, the technical chart revealed the formation of a megaphone pattern in the daily time frame. This pattern is characterized by a series of higher highs and lower lows, creating a shape similar to a widening cone.
Under the influence of this pattern, the coin price strictly bounces off from two diverging trendlines, where the progressive trend shows higher high peaks and lower low valleys. The chart pattern offers a significant trading opportunity once the prices break either of the aforementioned trendlines.
Amid the recent recovery, the Bitcoin price rebounded from the combined support of $20000 and the lower trendline of the megaphone pattern. Within a fortnight, the resulting V-shaped recovery surged the BTC price 37% higher to reach the current price of the $ 27229 mark.
During the bull run, the coin price breached two crucial resistance, i.e., the $25100 horizontal level and the megaphone pattern’s upper trendline. These breakouts offer buyers a significant footing to climb higher levels of the chart.
If the buying pressure persists, the Bitcoin price could rise to the following targets $28000, $32000, and $35000.
Also Read: What Are Bitcoin Ordinals And How Do They Work?
RSI: The daily RSI slope showcases an evident bearish divergence against rising price action indicating the underlying bullish momentum is weakening. Thus, the BTC price is likely to witness a temporary correction as the price often falls back after a significant bull run to check price suitability at higher levels
EMAs: the BTC price trading above the daily EMAs(20, 50, 100, and 200) is a sign of a sustained bullish recovery. Moreover, a potential bullish crossover between the 100-and-200-day EMA could attract more buyers in the market.
Enter Opportunity On Potential Pullbacks
The Bitcoin price currently trades at the $27185 mark and continues to hover above the breached resistance trendline of the megaphone pattern. This breakout indicates the Bitcoin escape from the market uncertainty, increasing the possibility of a directional uptrend. Thus, if the coin price shows sustainability above the ascending trendline in the coming days, interested buyers can look for a retest opportunity with a target above the $30000 mark.
Interestingly, the Fibonacci retracement level shows significant alignment with the known support level of the daily time frame chart. Thus, in case of potential pullback, the Bitcoin price may tumble 7% down to test the combined support of 0.236 FIB level and $25000. This support level is strong enough to resume the prior uptrend from a correction phase.
A less likely possibility of a breakdown below the $25000 level could plunge the BTC price to 0.382 FIB at $23000, followed by 0.5 FIB level at $21500.
Any further downfall will question the credibility of the ongoing recovery phase in Bitcoin
Bitcoin Price Intraday Levels
- Spot rate: $27164
- Trend: Bullish
- Volatility: Low
- Resistance levels- $28000 and $32000
- Support levels- $25000 and $23870
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