After a strong rally, Bitcoin faced resistance at the $70K level, leading to a possible increase in selling pressure in the market. However, despite this resistance, the cryptocurrency is still trading above the crucial 100-day moving average, indicating that a consolidation phase may occur before the next move. Technical analysis of Bitcoin’s daily chart shows that as long as the price remains above both the 100 and 200-day moving averages, the overall market sentiment remains bullish, with the potential for a new all-time high in the near future.
On the 4-hour chart, Bitcoin experienced a surge from the $55K support level, breaking key resistance levels at $60K and $65K. However, upon reaching the upper boundary of a descending wedge pattern at $68K, the price faced selling pressure, leading to a consolidation phase within the pattern’s boundaries. A bearish divergence between the price and the RSI indicator suggests the possibility of a short-term bearish reversal, with the price potentially retracing back to the $65K support region. If Bitcoin breaks below the lower boundary of the wedge, a bearish scenario may unfold, but if buyers manage to breach the upper boundary and reclaim the $70K resistance, a bullish surge could follow.
On-chain analysis of Bitcoin’s futures market metrics, such as the Taker Buy/Sell Ratio, provides valuable insight into market sentiment. Following a rejection at the $70K level, a significant volume of market sell orders has been executed, causing the Taker Buy/Sell Ratio to drop below one. This indicates that futures market traders are anticipating a further decline in Bitcoin’s price in the short term, suggesting the potential for an extended consolidation phase with minor retracements. Overall, a combination of technical and on-chain analysis suggests a period of consolidation for Bitcoin before any significant price movement.
