Bitcoin bounced off key support and could break the $25,000 area in the coming days.
eject from support
Bitcoin has been trading inside a falling wedge since June 2022. This is a bullish pattern that usually leads to a breakout in most cases.
In fact, after bouncing off wedge support in November, Bitcoin broke out of the pattern with a large bullish bar. The move also helped BTC break the long-term bearish structure as it breached the $21,500 resistance area and hit the next resistance at $25,000.
After the correction, Bitcoin managed to flip the $21,500 area as support and is currently breaking the $25,000 resistance area.
The RSI completed a bullish failure swing pattern in favor of a breakout for Bitcoin by moving above the highs between divergences and holding above 50.
If successful, the next level of resistance is at $30,000, created by the previous support area.
BTC/USDT Weekly Chart | Source: TradingView
short term outlook
After a strong rally since the start of the year, BTC consolidated within an ascending parallel channel before falling below it on Feb. 9.
The move resulted in a low of $21,400, just above the previous horizontal resistance. Afterwards, the price spikes and moves back inside the channel. This is a bullish development that usually leads to a sharp rally.
However, the 4-hour RSI has moved deep into the overbought zone, so a correction or consolidation is possible in the next 24 hours.
If so, Bitcoin could retest the $24,000 support created by the channel’s midline and previous top.
BTC/USDT 4-hour chart | Source: TradingView
The most likely price outlook suggests that Bitcoin could break through $25,000 and head towards the next resistance at $30,000.
However, a correction or consolidation may occur before the uptrend resumes.
You can see the token price here.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investors should do their research carefully before making a decision. We are not responsible for your investment decisions.
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