These two things need to happen for Bitcoin price to flip bullish
- Bitcoin price shows a continuation of the bear flag setup with no signs of invalidation yet.
- A daily candlestick close above $19,516 will be the first sign of a bullish resurgence.
- If buyers manage to flip the $20,737 barrier into a support level, it wil invalidate the bearish outlook.
Bitcoin price shows clear consolidation over the weekend with no volatility. However, with the Asian session waking up, things might start to get a little dicey as BTC lingers after a bearish move.
Bitcoin price in no man’s land
Bitcoin price action between September 13 and October 10 created a bear flag, which is a bearish continuation pattern. However, on October 10, the bears won the month-long struggle and sliced through the said pattern, creating a daily candlestick close below the pattern.
This bearish move, combined with the Consumer Price Index (CPI) announcement on October 13, knocked Bitcoin price down by 7.7% to $17,917. However, the recovery was quick, which pushed BTC up to close the day on a bullish note.
Although October 13 was volatile, to say the least, the next day undid a portion of the gains as Bitcoin price moved into the weekend.
Going forward, there are two important things that need to occur for Bitcoin price to flip bullish:
- Bitcoin price needs to overcome the 30-day Exponential Moving Average (EMA) at $19,516.
- Beyond conquering the 30-day EMA, BTC needs to flip the $20.306 to $20,737 resistance area.
If these two events occur with a strong daily close, Bitcoin price could kick-start a run-up to $22,048 and rebalance the Fair Value Gap (FVG), aka inefficiency.
Although it is too early to forecast, Bitcoin price could retest the $25,000 psychological level if it can overcome the blockade around $22,000.
BTC/USDT 1-day chart
While things are pessimistic due to last week’s move, investors need to be cautious of the bear flag setup, which forecasts a 12% downswing to $17,088. This target is obtained by measuring the flagpole, which is the price action between September 10 and 16 and adding it to the breakout point at $19,417.
From a macro perspective, a breakdown of the June 18 swing low at $17,593 could trigger a dire case scenario that could plummet Bitcoin price to $15,500. While this outlook seems too bleak for some market participants, investors need to at least prepare themselves for a sweep of $17,593 for the week.
Author
Akash Girimath
FXStreet
Akash Girimath is a Mechanical Engineer interested in the chaos of the financial markets. Trying to make sense of this convoluted yet fascinating space, he switched his engineering job to become a crypto reporter and analyst.
