Bitcoin recently fell short of achieving another record high as its price was turned away from $72,600 on Monday, resulting in a 4.5% decline. The question now looms: will the price retreat further, or is Bitcoin gearing up for another attempt at surpassing its previous peak?
The decline in Bitcoin’s price on Monday can be partly attributed to a significant outflow from Bitcoin ETFs, notably the Grayscale ETF (GBTC), which saw a hefty $303 million leaving its coffers, unmatched by Blackrock (IBIT). The net outflow totaled $223 million for the day.
In the short term, examining the 4-hourly timeframe reveals a straightforward narrative. The rejection from the $72,600 resistance level was a natural occurrence, prompting the price to retest the upper boundary of the breakout triangle. While the $69,000 support within the triangle remained untouched, the upper trend line upheld the price. The next move hinges on whether Bitcoin will undergo a period of sideways movement, allowing for the reset of shorter-term stochastic RSI momentum indicators.
Zooming out to the weekly timeframe unveils a tug of war between bullish and bearish forces, depicted through candlestick patterns. The red candle marking the failed attempt at a new all-time high indicates a fierce battle, culminating in indecision. However, subsequent candles, such as the bullish hammer candle and the green engulfing candle, suggest continued bullish momentum, though the hanging man candle from last week introduces the possibility of a bearish reversal.
The trajectory of this week’s price action is critical. A close above the hanging man candle could negate its bearish implications, potentially signaling a breakout from the current consolidation phase. Additionally, monitoring the stochastic RSI on the weekly chart reveals the flattening of signal lines, hinting at a potential reversal to the upside, which could fuel further bullish momentum.
