The price of Bitcoin continues to ascend, capturing the attention of a cautious market. Observers are left wondering whether this marks the beginning of a substantial rally that could propel Bitcoin back to its previous highs, or if the ongoing bottoming process will persist.
Analysis of the 4-hour chart for BTC indicates that the cryptocurrency is on the verge of a significant breakout. Following a false breakout on Monday, where the price retraced into a bull flag and tested the $90,500 support level, a bounce has occurred. Currently, the price has once again broken out, retested, and appears poised to either advance past the $92,000 resistance or face rejection.
Indicators at the bottom of the chart are showing promising signs. The Stochastic RSI is trending upwards, indicating increasing price momentum, while the Relative Strength Index is beginning to rise above its downward trendline. This suggests that bullish sentiment may be gaining traction.
Examining the Bitcoin to gold ratio on a low hourly timeframe reveals that BTC has recently broken through a downtrend against gold. Although this observation is based on a shorter timeframe, it highlights the importance of the weekly timeframe, where 19 ounces represents the significant support level for BTC against gold, with 25 ounces acting as the next major resistance.
Stepping back to the daily timeframe, Bitcoin seems to be breaking through the $92,000 threshold. A move towards the crucial $94,000 horizontal resistance level now appears likely. A successful breakout from the ascending triangle pattern could refocus market interest on Bitcoin, shifting attention away from sectors like AI, gold, and silver, which had previously dominated investor interest as Bitcoin struggled at lower levels.
The market remains largely unaware of the potential for Bitcoin to surge higher. Current sentiment is entrenched in fear, with many retail investors migrating towards AI and precious metals, believing those assets will yield ongoing gains. However, Bitcoin may be positioned at a low point compared to these assets, suggesting that a mean reversion could soon occur.
Finally, a look at the Stochastic RSI across weekly, bi-weekly, and monthly timeframes reveals that all indicators are at their respective lows. The weekly indicator is the first to show signs of rising, with lines approaching the 20.00 level. This could signal an impending surge in price momentum for Bitcoin.
In conclusion, while bears may note the existence of a bear flag in the long-term perspective, the prevailing ascending triangle pattern may provide a more fitting interpretation of the ongoing price action. If this pattern holds, it could set the stage for a measured move towards the key $108,000 resistance level, thereby nullifying the bear flag scenario and surprising many market participants.
