At the moment, Bitcoin (BTC) investors are anticipating the leading cryptocurrency to build on its short-term bullish momentum as it targets breaching new resistance levels.
Amid this anticipation, a crypto analyst using the pseudonym Thescalpingpro in an X post on July 7 noted that Bitcoin’s weekly close is crucial, given that the cryptocurrency has broken down below a key range after 125 days of consolidation.
The expert opined that Bitcoin has been consolidating in a range for over four months, fluctuating between a high of approximately $66,000 and a low near $33,000. This range was marked by significant volatility but without a decisive move in either direction until now.
Bitcoin price analysis chart. Source: Thescalpingpro
He added that Bitcoin’s price broke down below this long-standing consolidation range, signaling the potential for a significant move. Historically, when Bitcoin breaks out of a consolidation phase, it tends to follow through in the direction of the breakout.
The two Bitcoin scenarios to watch out for
In this line, Thescalpingpro outlined two potential scenarios for Bitcoin’s price movement from here. The first scenario is bullish: if Bitcoin reclaims the $60,000 level by the weekly close, the recent breakdown will be considered a fakeout.
In this scenario, Bitcoin’s price is expected to surge towards the high end of the previous range, potentially exceeding $70,000. This move would indicate strong bullish momentum and a quick recovery from the recent dip.
The second scenario is bearish: should Bitcoin close below the $60,000 mark for the week, it suggests a continuation of the bearish trend. This could lead to a retracement to the old mid-range level of around $44,233 before any potential higher price action. The bias is currently slightly to the downside as Bitcoin is trading below the crucial $60,000 level.
The analyst’s data showed that the fakeout was caught between $66,000, representing the upper boundary of the consolidation range, and approximately $44,233, the mid-range level.
Indeed, a breakout above the range failed to sustain, leading to a return to the consolidation range, and the recent breakdown below the consolidation range prompted the current analysis.
The significance of $60,000
Additionally, he stated that the market’s bias is slightly to the downside as Bitcoin remains below $60,000. However, reclaiming this level could quickly shift sentiment, driving the price towards new highs.
It’s worth noting that the general market consensus remains that the $60,000 level is an area to watch. For instance, as reported by Finbold, Ali Martinez noted that for Bitcoin to resume its bull run, it needs to reclaim $61,000 and hold that position.
Meanwhile, at the time of reporting, Bitcoin traded at $56,849, failing to maintain a price above $57,000.
Disclaimer:The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
