Bitcoin’s price rebounded by 18.50% within a week after dropping to a six-month low of $49,755. However, due to a mix of technical and on-chain indicators, the cryptocurrency may face further corrections in the coming weeks.
Current Bitcoin Situation
As of August 16, about 83% of Bitcoin holders were in a profitable position. In March, the percentage of long-term investors making a profit was around 96%. A high number of Bitcoins held in profit is usually seen as a sign of FOMO that precedes or coincides with price corrections. As a result of this on-chain signal, if LTHs decide to take profits, Bitcoin’s price may see pullbacks in the coming days.
Triangle Pattern and Its Significance
Bitcoin’s ongoing consolidation movements highlight a rising triangle pattern. This setup technically forms after a strong downtrend, indicating a possible reversal or weakening of downward momentum. However, in some cases, a rising triangle can act as a continuation pattern in a downtrend. If the price fails to break above the resistance and instead breaks below the rising trendline, the downtrend may continue. This indicates that sellers have regained control.
Expert Commentary
The bullish setup aligns with the outlook presented by Charles Edwards, founder of the crypto asset fund Capriole Investments. Edwards argues that Bitcoin’s price is trailing behind safe-haven rival gold. He overlaid Bitcoin’s chart on gold’s chart and acknowledged that the precious metal is three months ahead in its movement. Gold has already broken out upward from its previous consolidation trend, which could cause Bitcoin to do the same.
Amid current price fluctuations in Bitcoin, it's essential to monitor technical indicators and signals indicating possible trend changes.
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