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Bitcoin price stands out for holding firmly in a narrow range between $29,000 and $30,000 for several weeks. This consolidation cuts across the crypto market, with experts calling for regulatory clarity in the United States, expected to catalyze the move above $30,000.
Doddering at $29,730 toward the end of Asia’s business hours, Bitcoin price is up 1.8%, boasting $18 billion in trading volume and $577 billion in market capitalization.
The biggest hindrance to a Bitcoin price breakout is the record low volatility, which Vivien Fang, who heads trading products at exchange firm Bybit. Fang while talking to CoinDesk implied that the current situation might last up to the end of the year, as investors focus on catalysts “potentially linked to ETF narratives or industry-transforming events.”
Bitcoin Price $30k Mark is a Critical Threshold
Bitcoin price staying closer to the $30,000 mark implies that it is an area of significance, with the possibility to lead to a major breakout bound for $40,000.
A falling wedge pattern on the daily chart implies that a breakout, although potentially short-term is around the corner.
This bullish chart pattern signals a potential reversal or continuation of the trend. It is formed when the price makes lower highs and lower lows within a narrowing range, creating a wedge-like shape.
The wedge pattern is validated when the price breaks above the upper trend line, indicating that the buyers have regained control and are ready to push the price higher.
Bitcoin traders tapping the falling wedge pattern can identify entry and exit points for their orders.
For example, it is advisable to enter a long position when the price closes above the upper trend line, close to the $30,000 mark, and set a stop-loss below the most recent low slightly above $29,000.
$BTC Bulls Maintain Control 📈🔥
– Defending the Major Trendline
– Falling wedge Breakout #Crypto #Bitcoin #BTC pic.twitter.com/AKDECG4ONm— Captain Faibik (@CryptoFaibik) August 9, 2023
Traders can also use the height of the wedge as a target for their profit-taking, in this case, extrapolate 8.78% from the breakout point to highs roughly at $32,247.
Validating The Bullish Potential In Bitcoin Price
Despite the mundane trading environment in the crypto market, Bitcoin price could extend the bullish outlook exhibited on the daily chart above $30,000 this week. Investors looking out for buy signals may want to pay attention to the Moving Average Convergence Divergence (MACD) indicator.
The impending falling wedge pattern breakout could materialize quickly if traders heed the call to buy BTC as the MACD line in blue crosses above the signal line in red. Nonetheless, breaks above $30,000 must be followed keenly to determine if they are sustainable or may culminate in bull traps.
That said, the Money Flow Index (MFI) shows that buyers have the upper hand, especially with the inflow of money into Bitcoin markets far outweighing the outflow volume.
On the other side of the fence, retracements cannot be ruled out and support at the $29,345 reinforced by the 50-day EMA (red) may come in handy to arrest the bearish situation before it complicates the situation for the bulls at $29,000 and pave the way for losses to $28,000 and $25,000.
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