Bitcoin
Crypto Analyst Says Bitcoin’s Decline Is a Bear Trap. Can the price recover above $70,000?
Bitcoin is currently on a recovery path, which follows analysts’ prediction that the price decline over the past two days was yet another bearish trap. Crypto analyst Orson Fawley elaborates more on this in his analysis and shows that the Bitcoin the price remains inherently bullish given its recent movements.
Bitcoin recovery is strong
Fawley took to the TradingView website to to share his analysis on Bitcoin, covering its rise from last weekend to Monday’s price drop. The crypto analyst pointed out that with the weekend surge that began on Friday, Bitcoin was able to form a broad bullish D1 candlestick near its high.
Now the problem with wide range D1 candlesticks is that they are used to measure buying pressure. Given that this candlestick closed close to the Bitcoin on the rise on Friday, Fawley explains that this means the price was rising due to strong and sustained buying pressure on BTC.
Furthermore, the analyst explains that the candlestick had also broken Bitcoin’s previous “Inside Bar pattern”. This tells much the same story as the broad D1 candlestick closing to close its high, meaning buying pressure was sustained for the digital asset.
As a result of this price increase, Bitcoin managed to surpass $60,000, which the crypt analyst identifies as an important psychological level. Breaking this $60,000 level was positive for the coin and fuels Fawley’s sentiment that the price drop was a false breakout. In other words, the decline was a bear trap.
Source: Tradingview.com
For those unfamiliar, bear traps are price drops after a period of price recovery that makes investors believe the price has peaked. This attracts more bears who continue to short the price, thinking it will continue to fall, but eventually the price resumes its upward trajectory. Since Bitcoin The price decline has been identified as a bearish trap, meaning the cryptocurrency’s price is expected to continue rising towards its all-time highs.
BTC Buying Pressure Continues
Fawley also analyzed the price of Bitcoin going forward, using the 4-hour chart as a point of focus. In this chart, the crypto analyst confirmed that Bitcoin formed a V-shaped pattern as a result of strong buying pressure from the falling bottom.
He also points out that the coin has broken above the descending trendline resistance. This comes as the Bitcoin price is forming an accumulation zone around its recent high, which was around $64,000. According to the analyst, if Bitcoin “manages to surpass this price rally and the PPZ area, Bitcoin H4 will revert to the uptrend structure in the H4 period.”
Currently, the BTC Price it is still above $64,000 after a sharp rise in the early hours of Tuesday. That’s it daily volume also increased by 45%, lending credence to Fawley’s analysis that buying pressure remains strong. “The false breakout that created a bearish trap on Friday and continued through Saturday and Sunday shows that Bitcoin D1 is strengthening,” says Fawley.
BTC price drops below $64,000 | Source: BTCUSD on Tradingview.com
Featured image from Forkast News, chart from Tradingview.com