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Bitcoin Price Forecast: Tests Resistance at 69,000 Amidst Consolidation Range

By:
Bruce Powers
Published: Apr 4, 2024, 20:32 GMT+00:00

Consolidation pattern suggests Bitcoin may break out before May 7, with potential for bullish pennant continuation or bearish double top confirmation.

Bitcoin continues to trade within a developing consolidation pattern near record highs. It rallied on Thursday to test resistance at its prior record high of 69,000. That is a close match with resistance around the blue 8-Day MA and a test of the uptrend line. Previously the trendline was showing support, and now potential resistance. Today’s advance indicates that it may now represent resistance. Bitcoin stopped at the line, but it has not turned down from the line, which is needed to confirm that resistance area.

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Choppy Range Trading Likely to Continue

Choppy and range bound price action is likely to continue if Bitcoin remains within consolidation range that takes the form of a bullish pennant, or small symmetrical triangle. Purple trendlines define the boundary of the pattern on the chart. In addition, there are two lines near the lower end of the pattern that may provide some guidance going forward. One is the orange 50-Day MA, and the other is an internal trendline. The 50-Day line is now at 63,456 and the price of the line will depend on when it is reached.

Bull Pennant in Place

A bull pennant in a rising trend is anticipated to break out to the upside as the dominant trend continues to exert its influence. Nevertheless, this pennant is relatively new and needs more time to develop before momentum picks up again. The apex of the triangle is on May 7, and it tells us something about timing.

It means that Bitcoin will break out of the pattern prior to May 7, which means either up or down. Although technically a breakout is first indicated on a rally above last week’s high of 71.790, given the potential significance of the pattern forming near record highs, it would seem likely that Bitcoin continues to form the pennant for a while longer.

Possible Double Top

Alternatively, a bearish double top may be forming instead of a bullish pennant. Although, it won’t matter much unless the pattern is confirmed on a breakdown trigger. That won’t occur until there is a drop below the most recent swing low at 60,771. A breakdown and bearish trigger from the pennant would occur earlier though on a decisive decline below the lower boundary line. The price represented will depend on when it is reached as the line is rising.

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About the Author

Bruce boasts over 20 years in financial markets, holding senior roles such as Head of Trading Strategy at Relentless 13 Capital and Corporate Advisor at Chronos Futures. A CMT® charter holder and MBA in Finance, he's a renowned analyst and media figure, appearing on 150+ TV business shows.

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