Bitcoin (BTC) consolidates and gathers strength for next upside move

Bitcoin (BTC) consolidates and gathers strength for next upside move

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After February’s strong up movement, Bitcoin has generally moved sideways through March and now into April. The longer the sideways move, potentially the bigger and more explosive move to follow. 

Since the beginning of February, and into the first half of March bitcoin put on 76% in price gains. From the top at $73,800, the price has moved down and sideways. The longer this current move continues, the bigger a potential consequent upside movement could be.

$BTC bull pennant takes shape

Source: Coingecko/Trading View

On the daily time frame it can be seen that the $BTC price was able to haul itself back above the trend line it has been following since early February. However, on Friday the price has dipped back below. That said, the chart pattern has now morphed into a bull pennant, which is more likely to be exited from to the upside than the downside.

Sideways movement until the pattern breaks

Source: Coingecko/Trading View

Zooming in with the 4-hour chart, it can be observed that $BTC is indeed traversing along inside the pennant. This could mean that the $BTC price continues this sideways price action for nearly another two weeks, although $BTC generally tends to exit these patterns before getting to the end of them.

A huge measured move

Depending where one starts the measured move for the bull pennant (and this can be quite subjective) will ultimately decide the eventual target. With this in mind, assuming that the bottom of the flagpole is taken from 23 January, at the then price of $38,600, gives a target of $105,000, which does correlate somewhat with the 1.618 fibonacci, which gives a similar price of $102,000.

If $BTC breaks from the pattern in the opposite direction, the measure move would potentially take the price all the way back to $51,000. This would correlate with good support at this level.

If we concentrate on this latter, bearish scenario, it might be a move that would strike fear into the hearts of many investors. Nevertheless, it would be a healthy move which allowed more price structure to be built, providing a more solid base for the next move up. In addition to this, it would give another opportunity to buy bitcoin for those still wishing to enter the market, and for those already in who would be able to increase their positions.

Making sure you have some bitcoin

When trading or investing in any other asset, taking profit is a huge consideration. However, when it comes to bitcoin, making sure that you have some, or that you have a decent position, is all that matters. At the end of the day, if you believe in bitcoin, and understand what it is doing, buying it and self-custodying it is arguably the most important thing that you can do.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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