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Latest inflows and market dynamics we have seen Bitcoin price break out of a 7-month descending expanding wedge pattern. According to cryptocurrency analyst Gert van Lagen, Bitcoin’s breakout last week could signal the beginning of an vital phase of price continuation as bulls are targeting above the $70,000 level. In particular, Van Lagen highlighted that Bitcoin’s ability to successfully retest the upper trendline of this pattern gives forceful momentum to the current bullish structure.
A descending, widening wedge pattern is a reversal structure in technical analysis, often indicating a forceful trend following a breakout. Bitcoin’s ability to break the upper trend line increases the likelihood of bullish momentum, giving voice to a fresh all-time high in the coming weeks.
Bullish retest confirms forceful support ahead of next rally
In van Lagen’s time analysisBitcoin price was once again testing the lower trendline that has capped price gains since hitting an all-time high of $73,737 in March. By this time, Bitcoin had already peaked outside this trendline in a descending widening wedge and was already on the third candle.
As Bitcoin bounced off the upper trendline, van Lagen described it as a “successful bullish retest.” Furthermore, he noted the importance of a bullish trajectory for this pattern, highlighting that the breakout direction is up 79% of the time.
Since Bitcoin’s price has already crossed this wedge, the cryptocurrency may boost its gains and rise above $70,000 in the next phase. In this regard, the analyst also noted that reaching a fresh all-time high is necessary to fully confirm the continuation wave pattern.
Key Bitcoin price levels to watch
During breakout and retest offer promising technical signs, van Lagen warned of a critical level of decline that investors should monitor. He pointed out that the key weekly closing price is $58,700, below which the bullish structure will be invalidated. In his view, a close below this threshold would disrupt the continuation of the rapid fifth wave and completely reverse the bullish setup to a fresh all-time high.
Interestingly, since this breakout, Bitcoin has managed to break higher. The cryptocurrency in particular saw further gains and broke above $71,000 for the first time since June.
At the time of writing, Bitcoin is trading at $71,150, having hit an intraday high of $71,450 in the last 24 hours. As it stands, Bitcoin is only 3.6% away from reaching uncharted price territory. The the only key price resistance level to The watch will be the current all-time record at this point.
Many Bitcoin indicators point to continued bullish momentum in Bitcoin prices, at least in the miniature term. Open interest in Bitcoin has currently peaked at $42.6 billion, which means: high level of trading activity among Bitcoin traders.
Featured image created with Dall.E, chart from Tradingview.com