Bitcoin’s Rising Wedge Pattern Could Spell Trouble For The Bulls

Bitcoin’s rising wedge pattern could spell some trouble for the bulls as the cryptocurrency failed to shoot past $50K on Sunday despite the increasingly bullish sentiment for the upside target. The benchmark cryptocurrency alerted the potential bearish reversal after it formed a “Rising Wedge pattern” so let’s take a closer look at the price analysis in our Bitcoin latest news today.

The BTC/USD exchange rate got higher over the past few days but it did leave a trail of the higher highs and the higher lows. The move formed two upward sloping trendlines which converted towards a single point named “apex” so the structure constituted the Rising Wedge formation which usually brings a price breakdown. The downside target in the Rising Wedge came to be equal to the maximum distance between the upper and lower trendline. In Bitcoin’s case, the length was about $5500 which put the Wedge bear target near $43,000 in the coming sessions.

The bears are not in control still despite the many breakdown attempts so it seems that breaking below the Wedeg’s lower trendline prompted BTC to receive more support from another upward sloping trendline which constitutes an Ascending Channel pattern. The price floor could be set for another move upwards which is a rebound move that will have BTC test its all-time high of $49,700 followed by a close of $50K. More bullish tailwinds come from the Bitcoin RSI which remains absent from the overbought conditions despite trading near the levels. As a result, the cryptocurrency will likely undergo a slight rebound near $50K with the $48K level acting as an interim hurdle.

The on-chain indicator supports the short-term bullish outlook as the data by CryptoQuant shows, indicating that the traders will most likely use the dollar-pegged token to buy crypto like BTC. Ki-Young Ju, the CEO of CryptoQuant noted:

 “If you’re a long-term investor, now is the time to buy BTC. Not sure how many corrections would be along the way, but the on-chain indicator says there are enough stablecoins in exchanges compared to Bitcoins to get another leg up.”

With traders and investors building up their positions, they expect to face a new wave of risks from the US Economy and its potential to undergo recovery. In the recent report, the Bank of America noted that the US dollar could post more growth in 2021 as the Federal Reserve aims to reduce the ultra dovish-stance with the $120 billion per month purchase program. The strategist believes that the policy normalization will appear at the start of 2022.