If the current price action is a top formation, it doesn't match the sharp spikes of bitcoin and blow-off tops that the cryptocurrency is known for. Only once more in the past ten years has a comparable rounded top formation appeared in the BTCUSD price charts. And when it happened there was a big correction.
If the first cryptocurrency doesn't pump up soon and prove that this trading range isn't top, another collapse could be the next.
When does the confusing sideways range end and crypto break out?
The current Bitcoin price campaign has confused the crypto market and its participants. The indecision is reflected both in the sideways price movement and in the doji at the end of the month in June.
Volatility in the normally notoriously explosive asset class has reached record lows. The cryptocurrency rarely stays in this narrow trading area for a very long time. When it finally breaks out, a powerful move of over 20% follows, according to data.
Crypto analysts review past price movements in Bitcoin to get clues as to how current and future price movements can affect.
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Basically, Bitcoin has never been healthier. Halving the cryptocurrency is just over, and records for the least BTC in years have been set up. A number of key indicators are "screaming buy".
Technically, the cryptocurrency could be on the verge of its next long-term uptrend. Or another crash could be on the way before this happens.
And if the current price movement is a slowly rounding peak, it only marks the second structure of this kind in the history of the asset. Only once more did Bitcoin trade within a similar range and timeframe, and a massive correction followed.
Bitcoin Ditches Sharp, blow-off tops for rounded formation, the last time a dangerous drop followed
The leading cryptocurrency by market capitalization is at a dead end. A new tool indicated that the next Bitcoin bull run was here, but the pandemic had other plans. Now, the number of outbreaks is increasing worldwide and endangering the crypto market with another strong sell-off.
The last panic sellout on Black Thursday halved the Bitcoin price within 48 hours. The move shocked the investment world with record losses at every turn.
While the asset has since recovered alongside the stock market and the cases are increasing again, there is a greater risk and a higher risk.
With the increase in cases and the return of fear, Bitcoin is ready to make a decision.
The asset was traded sideways in a 20% range for 63 days. The only other example of a rounded top in Bitcoin history trading within a similar range and timeframe led to a shocking decline.
The decline led to a further low in Bitcoin and a deeper dive into an expanded bear market.
Such a scenario is unlikely given the basic health of Bitcoin and the upcoming hyperinflation. However, Bitcoin has to prove that this is not a long, elongated, rounded top.
This kind of Rounding formation exhausts the buyers at a high level, which makes the decline all the more apparent. Fewer shoppers are willing to go down after the purchase with the above loss.
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It could be the catalyst needed for a bigger, more effective shake of the strongest holders.
A rounded top here at current prices would lead to a lower high. The drop on Black Thursday after falling to $ 6,000 in December 2019 was a lower low.
A lower high and a lower low are the definition of a downtrend. If Bitcoin can't set a new high, a lower low can come, and this rounded top could be the reason.