The Bitcoin price experienced a minor recovery rally in mid-June, providing some respite for coin holders after the recent sell-off in the crypto market. Prices surged 5% from a local support at $25,200 to the current price of $26,473. However, higher price rejections in the daily candles imply that the overall market sentiment remains bearish. One might question if the buyers will be able to turn the tide with this recovery, or will the sellers maintain dominance?
The Bitcoin fear and greed index, currently at 48%, indicates a neutral market sentiment. A falling wedge pattern influences the current retracement phase in Bitcoin price, suggesting that this recent relief rally is likely temporary growth. A bullish reversal triggered by the pattern’s lower trendline could initiate a new bull cycle, potentially driving prices back up to the upper trendline.
At the moment, the BTC price is trading near the overhead trendline, where supply pressure is evident with long-wick rejection candles. If selling pressure continues for several more trading sessions, the coin price may initiate a bearish reversal. This potential reversal would signal the continuation of the downward trend, dragging the price back to $25,000.
In order to break free from the correction phase, Bitcoin price needs to complete the existing chart pattern. The recent price surge implies that the BTC price may hit the resistance trendline of the wedge pattern, attempting to validate the overhead supply. It is essential for potential traders to observe the price behavior at this trendline to determine future prospects. A reversal from this barrier might prolong the current downfall, while an upside could create a pathway for a sustained recovery.
The Relative Strength Index (RSI) seems to conflict with the new lower low in the price action since the RSI slope forming the same lows indicates that the underlying bullish momentum is increasing. In addition, the Exponential Moving Average (EMA), with the 50-and-200-day EMA, creates a narrow range which could contain the possible consolidation phase in Bitcoin price.
It is vital for investors to perform thorough market research before investing in cryptocurrencies. Market conditions and personal opinions should always be taken into account, as the author and the publication do not hold any responsibility for personal financial loss.
Source: Coingape
