Analyst Josh of Crypto World said that Bitcoin is presently retesting a critical support area and showing a short-term bullish divergence. This suggests more liquidations might occur soon, according to him. The analyst discussed the current state of Bitcoin, bringing to attention several key technical indicators and potential market movements. After a meteoric rise, Bitcoin is currently struggling to rise above the $70k levels.
Focusing on the 4-day Bitcoin chart, he said that the Bollinger Bands are tightening, indicating a move is likely in the coming weeks. This move could be substantial, potentially between 20% and 30%. The Bollinger Band Width Indicator is still moving sideways, implying that this major move has not yet started. Overall, Bitcoin remains in a large sideways consolidation within a broader bullish trend, similar to patterns observed around mid-2023.
The 3-day Bitcoin chart suggests a possible inverse head and shoulders pattern, which could lead to a bullish price target of around $86,000 to $87,000. However, for this pattern to be confirmed, Bitcoin needs to quickly move towards the neckline at approximately $71,700 and close above $73,000 to $74,000 with a 3-day candle.
On the daily chart, Bitcoin is retesting a critical area between $67,000 and $68,000, a zone with major traded volume and resistance. To turn bullish in the short term, Bitcoin must break and stay above $68,000. Failure to do so could result in continued resistance and potential short-term pullbacks.
If Bitcoin faces rejection from this resistance, there is important support between $63,000 and $64,000. The volume profile indicator shows a gap in traded volume from $66,000 to $64,000, indicating a quick move between these levels if $66,000 is breached.
However, the Bitcoin chart indicates low volatility but shows a short-term bullish divergence. This could lead to a slight bullish relief, targeting the liquidity area between $67,300 and $67,900. However, a confirmed breakout above $68,000 is necessary to end the current pullback and resume bullish momentum.
