What Type Of Pattern Is Bitcoin Forming Into?

Bitcoin BTC/USD is trading lower Thursday in a cryptocurrency market that is down overall.

Bitcoin looks to be forming into a pattern that could be considered bullish despite the crypto being down the past few days. Bitcoin has recently been trending on multiple social media platforms.

Bitcoin was down 3.72% at $58,115.32 Thursday afternoon at publication.

Bitcoin Daily Chart Analysis

• Bitcoin looks to be trying to hold a previous resistance level as support, while also looking like it is forming into what technical traders call a cup and handle pattern (orange).
• The $60,000 level is an area where Bitcoin had troubles crossing above in the past, but is trying to hold it as support. If unable, the crypto could see a further dip. The cup and handle pattern has been forming throughout the year and looks to be in the handle part of the pattern. If Bitcoin can get hot again it could see a strong push back higher throughout the rest of the year’s end.
• The crypto is trading below the 50-day moving average (green), but above the 200-day moving average (blue) indicating the crypto might be in a period of consolidation.
• The 50-day moving average could hold as an area of resistance, while the 200-day moving average will likely hold as an area of support.
• The Relative Strength Index (RSI) dipped lower the past couple of days and now sits at 39 on the indicator. This shows that the selling pressure has been greater than the buying pressure, causing the dip in the price.

What’s Next For Bitcoin?

Bullish traders are looking for this consolidation period to happen and for the crypto to bounce back soon and begin forming higher lows. Bulls want to see the cup and handle pattern finish and for Bitcoin to see a strong December.

Bearish traders are looking to see the stock continue to fade lower and for the crypto to be unable to find an area of support. Bears are looking to see the crypto keep dipping and for traders to start getting fearful and sell their Bitcoin. This could possibly cause a strong bearish push in the future.

Photo: Francois Mckenzie via Unsplash