Bitcoin [BTC] Price Analysis: Bear Flag Forming for Bitcoin
The week wrapped up with bearish movements yesterday for the cryptocurrency markets.
Bitcoin recorded bullish movements on Saturday as it rose above a key resistance level at $3684.
However, price failed to close above and fell back below before Saturday’s daily candle finished.
Price followed up with bearish movements on Sunday which brought it back down to the point of last weeks low at $3476.
Price found liquidity at this point and has since been consolidating around $3520 to $3540.
Today’s daily candle is forming a Doji candle.
A Doji candle is a candle where the open and the close are around the same point and reflects uncertainty from the side of traders.
After finding liquidity at $3476, the price rose back up and has been consolidating since.
The consolidation increases the chances that the next significant move will be to the downside.
A downward movement followed by consolidation increases the possibility of another downward.
Price is currently forming what is known as a bear flag pattern where a downward move is followed by consolidation.
Other factors also lead to a more bearish outlook.
Saturdays return below the $3684 level shows the traders are rejecting prices above this level.
The key level to monitor if price drops from here is $3684.
This was the weekly low for the past two weeks. A drop below here may put a price on a trajectory towards 2018 lows at $3122
- Bitcoin price traded bullishly on Saturday but failed to hold levels above $3684.
- After dropping back below $3684, price continued downwards until it found liquidity at the $3476.
- Price is currently forming a bear flag pattern.
- Traders seem uncertain with a Doji forming on the daily. Although the price is forming a bearish pattern, a drop below $3476 may mean a return to the 2018 low at $3122.
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