Price Analysis

Bitcoin Breaks Above Consolidation, Is $70,000, the Next Pit Stop for the BTC Price Rally?

The market sentiments have become somewhat hopeful after the Bitcoin price rally marked the monthly highs at $66,666 in the early trading hours. A huge rise in buying pressure caused the token to break above the falling wedge, which has circulated bullish waves within the markets. However, the market participants continue to remain hesitant to enter at the moment, as the sentiments have dropped back to neutral after remaining hopeful for quite a long time. 

Despite the trade’s sluggish behaviour, open interest increased by more than a billion dollars over the last trading day. The traders were perplexed as to whether the bulls or the bears were dominating the rally. However, some negative funding was active, which may have triggered the shorts as the price faced a pullback before entering the key resistance zone. 

In such a case, the 2021 ATH of $69,000 may become increasingly important, as a rise above these levels may determine the next course of action.

The above chart displays a major momental shift in the BTC price rally, with the bulls gaining dominance, but on deep observation, the bears seem to have an equal impact. Below are the major reasons why traders need to be cautious of the current price action as the token continues to display some hidden divergence. 

  • Firstly, the stochastic RSI reached above the upper threshold, which suggests an interim pullback to the lower support at $64,618 could be imminent
  • Secondly, the volume remains within the average range and did not spike during the recent upswing. This indicates less involvement of bears, who could be waiting for the bulls to lift the levels beyond the previous range
  • Lastly and more importantly, the Ichimoku cloud remains unchanged. The cloud remains within the bearish range, with no signs of a bullish crossover soon.

The current trade setup suggests the Bitcoin (BTC) price may trap bulls above $65,000, with a pullback to $64,500 on the horizon. However, if the bulls show some strength here, the token may resume its bullish rebound and reclaim the lost levels very soon. 

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