ThBitcoin price could see a massive upward move and enter price discovery if a bullish chart pattern known as a descending broadening triangle is confirmed, according to a crypto trader.
“#Bitcoin is moving within a Descending Broadening Triangle,” crypto Post Trader Tardigrade explained in an Aug. 12 post on the X social media platform.
The analyst was referring to Bitcoin’s year-to-date price action on a two-week chart timeframe, which had formed a descending broadening wedge.
A descending broadening wedge is a technical chart pattern that appears during a downtrend and is characterized by two diverging lines that connect a series of lower highs and lower lows. A decisive break above the resistance of the wedge confirms a breakout on the upside.
“This is the same pattern as $BTC performed in 2019-2020,” he declared.
When the price of Bitcoin broke out of this pattern in 2020, it rallied 580% to the 2021 all-time high of around $69,000.
“The breaking of this pattern brought $BTC from near $10,000 to near $70,000.”
Bitcoin’s price had strongly rebounded from the support line of the prevailing chart pattern around $53,500 during the week ending Aug. 9, and if the pattern continues as Trader Tardigrade’s model suggests, it will confirm a bullish breakout by breaching the barrier at $69,000 — a key resistance level.
Fellow analyst Matthew Hyland also observed that the BTC/USD pair had formed a similar setup as it did “last year heading into Q4 as well as how it set up in election years (2012, 2016, 2020).”
Hyland explained that in each of these years, Bitcoin “found a bottom” before embarking on a sustained uptrend heading into the fourth quarter.
Hyland believes that the recent crash in Bitcoin price below $50,000 marked the bottom for BTC for this cycle.
In an earlier post on X, Hyland shared a chart showing that last week’s candlestick had the longest and lowest lower wick, marking a possible bottom for the pioneer cryptocurrency.
Independent trader Roman referred to this weekly closing as strong with a bullish divergence, adding that it is “just a matter of time” before the price embarks on a sustained uptrend.
Despite these positive outlooks, buyer interest in the crypto market is lower than during the FTX crash, according to the Fear & Greed Index.
The index is currently sitting on an “extreme fear” score of 25, a major decline from a day ago when it indicated “Fear” with a score of 39.
Meanwhile, some traders expect Bitcoin’s price to remain stagnant in the near term, but they don’t necessarily view this as a bearish signal.
“Overall, the price is still consolidating above the all-time high. The LTF drops below the support might be trapped before the price starts pumping again,” added independent trader Mags.
“Couple more days of limited reception. #Bitcoin rejected from channel midpoint, back at key support,” crypto trader Daan Crypto Traders told his X followers in an Aug. 11 post.
“Needs to form a higher low here, or bulls are in trouble.”
