Bitcoin Market Value Responds To This Bullish Pattern; Is $22000 Within Reach?

A recent reversal from the combined resistance of $20500 and resistance trendline have plunged the prices 4.2% down to retest the $19600 flipped support. This horizontal level and the rising support trendline should form a high reversal point from $19500-19200. However, losing this support may plummet the Bitcoin market value to $19500.

Key points:

• The rising parallel channel pattern is leading to a short-term recovery in Bitcoin
• A breakdown from the support trendline will undermine the recovery gains
• The intraday trading volume in Bitcoin is $30 Billion, indicating an 18% loss

Source-Tradingview

The crypto market has witnessed quite an uncertainty in the past two weeks. As a result, the major cryptocurrencies walked a sideways path, and Bitcoin prices remained trapped with $19600 and $18350 barriers.

However, on October 3rd, the Bitcoin value experienced a significant inflow and bolstered a bullish breakout from the $19600 resistance. The follow-up candle pushed the prices higher to hit the $20500-$20730 resistance zone. 

Furthermore, the traders faced strong supply at this resistance resulting in a sharp price reversal. The three consecutive red candles with a substantial surge in volume activity indicate the sellers have not thrown the towel yet.

Moreover, the recent price action reveals the Bitcoin market value is rising within a rising channel pattern. The technical setup for this pattern allows traders to replenish the selling pressure and resume the prior downtrend. Thus, the bearish breakdown from the support trendline will trigger the bearish pattern and may plunge the coin price back to the $18500 support zone.

However, until the price action remains within the pattern, Bitcoin could obtain more gains. Furthermore, in optimum conditions, a bullish breakout of this resistance trendline will breach the overhead trendline and offset the bearish thesis.

Technical Indicator

Relative Strength Index: A bullish divergence in the daily-RSI slope shows a strong buying activity around the $18500 mark. If the indicator value sustains above the midline, the positive attitude gained should push the recovery rally higher.

EMAs: the breached 20-day EMA offers additional support to buyers at $19600. However, the retest of crucial EMAs(50, 100, and 200) is assisting sellers in maintaining a bearish outlook.

Bitcoin Price Intraday Levels

• Spot rate: $19600
• Trend: Downtrend
• Volatility: Medium
• Resistance level- $20600 and $21800
• Support level- $19600 and $18500-18300