Bitcoin May Reach New All-Time High If Current Chart Patterns Work According to Analytics

A unique trading pattern suggests Bitcoin could experience a significant price surge in the coming months.

Source: coinmuhendisi.com

According to crypto traders, Bitcoin is currently following a bullish chart formation known as a descending broadening triangle, which might pave the way for a new all time high. In an August 12 post on X platform, analytic Tardigrade pointed out that Bitcoin's price action this year has formed a descending broadening wedge on a two week chart. This technical pattern typically emerges during a downtrend and is characterized by two diverging lines that connect a series of lower highs and lower lows. A decisive breakout above the resistance line of the wedge generally signals a potential for substantial upward movement.

Tardigrade compared the current pattern to Bitcoin’s performance in 2019 2020. During that period, a similar descending broadening wedge pattern led to a dramatic 580% price increase, culminating in Bitcoin’s peak at around $69,000 in 2021. Recently, Bitcoin’s price had a notable rebound from the support line of the current pattern, which was around $53,500 during the week ending August 9. If the pattern continues as Tardigrade suggests, a bullish breakout could occur, pushing Bitcoin past the $69,000 mark and into uncharted territory.

Adding to the optimistic outlook, analyst Matthew Hyland observed that Bitcoin's current setup mirrors patterns seen in previous years, particularly during the fourth quarter of election years (2012, 2016, 2020). Historically, Bitcoin has found a bottom before initiating a strong uptrend in these periods. Hyland believes the recent dip below $50,000 could represent the low point for this cycle, with a potential sustained uptrend on the horizon.

Independent trader Roman also highlighted a strong bullish signal, noting that the weekly candlestick from last week had the longest and lowest lower wick, which could indicate a bottom for Bitcoin. He suggested that a sustained uptrend is likely, though it may take some time to materialize. Despite these positive signals, the broader market sentiment remains cautious. The Fear & Greed Index currently shows extreme fear with a score of 25, a sharp decline from the previous day’s fear score of 39. This indicates a significant drop in buyer interest compared to the FTX crash period.

Some traders are anticipating that Bitcoin's price might remain relatively stagnant in the short term. They do not necessarily view this consolidation as a bearish sign but rather a potential precursor to future gains. Trader Mags noted that Bitcoin is still consolidating above its all time high and suggested that any recent drops below support levels could be temporary, with the possibility of a price increase once consolidation completes.

Trader Daan Crypto Traders echoed this sentiment, pointing out in an August 11 post on X that Bitcoin had been rejected from the channel midpoint and was back at a key support level. He speculated that after a few more days of limited movement, Bitcoin might be poised for another upward push. Overall, while there are mixed views on Bitcoin’s short term movement, the prevailing sentiment among some analysts and traders points to a potential bullish breakout in the near future, driven by the current technical patterns and historical trends.

Disclaimer: FameEX makes no representations on the accuracy or suitability of any official statements made by the exchange regarding the data in this area or any related financial advice.