Bitcoin printed a bull flag on the daily chart, a technical chart pattern associated with strong upward momentum for the asset. Could it signal the start of the post-halving bull run?
Bitcoin bull flag suggests more upward momentum — Analyst
Bitcoin printed a bull flag pattern on the daily chart on April 26, according to an X (formerly Twitter) post by popular crypto analyst Mikybull, who wrote:
“Bitcoin on a daily chart forming a bull continuation pattern. According to Wyckoff’s law of cause and effect ‘the longer the consolidation, the more explosive the markup will be.’‘
The current chart formation is “a strong bullish setup,” according to Denis Baca, financial analyst and head of product at Zivoe. Baca told Cointelegraph:
“We’re seeing a bull flag on Bitcoin’s daily chart, which historically suggests more upside. It’s shaping up nicely after a solid rally, with declining volume indicating a pause before potentially shooting towards $100,000.”
However, Bitcoin is unlikely to rally higher in the absence of a significant catalyst, according to Andrey Stoychev, the head of prime brokerage at Nexo. He told Cointelegraph:
“After testing $64,000 more than once on the day, only to confirm it as resilient support, Bitcoin does signal the potential for a further climb upward. Despite that, any significant price rises could remain unrealized, with Bitcoin merely reaching the upper bands of the established trading range of around $67,000.”
Traders should keep an eye on the $65,000 Bitcoin price level. A move above this level would liquidate over $500 million worth of cumulative leveraged short positions, according to Coinglass.
Could Bitcoin price dip below $60,000 before the bull rally?
While Bitcoin has seemingly formed strong support above the $60,000 mark, a potential dip below could still happen before rallying to new highs, according to Baca. He said:
“Historically, going into May, we see Bitcoin fade to retest support of the 20-week SMA [small moving average], which would put Bitcoin at $56,000. I think such a move would be healthy before going higher. It’s exactly these kinds of dips that can offer solid buying opportunities before the next climb to record highs.”
However, Nexo’s Stoychev doesn’t expect Bitcoin to fall below $60,000 unless U.S. interest rates remain high for longer than expected. He said:
“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 falls below $60,000, it would liquidate over $1.4 billion worth of cumulative leveraged long positions, according to Coinglass.
