Bitcoin (BTC) is nearing the end of a consolidation period which traders are betting will spark a fresh bullish breakout.
In a tweet on June 1, popular trader Crypto Ed became the latest voice in the expanding bullish movement calling time on lower BTC price levels.
Data: D-Day for Bitcoin price starts Wednesday
After consolidating in a broad range since hitting $30,000, BTC/USD is printing higher lows and lower highs on lower timeframes.
This narrowing wedge on the chart has a logical end point where volatility becomes practically zero — and historically, this results in a major move up or down.
“Expecting that bounce any moment now,” Crypto Ed summarized.
“When it does, I think we break out to the upside in coming days.”
He added that a failure to break out could have the opposite effect, a nod to those already warning over a possible fresh bearish dip towards $20,000.
A look at the hourly chart meanwhile dictates a make-or-break moment for Bitcoin on June 2, at which point market trajectory in the near term should be decided.
“Expect volatility by week’s end,” fellow trader Lark Davis added.
— Lark Davis (@TheCryptoLark) June 1, 2021
The pattern of sideways trading following a major price move which culminates in a narrowing wedge and breakout — known as “compression” — is a classic chart phenomenon for Bitcoin. The process characterized much of 2020 in particular before the bull market truly kicked in to take BTC/USD past its 2017 all-time highs.
50-day moving average stays as classic support
For Rekt Capital, meanwhile, an essential long-term chart feature is of interest following the $30,000 dip.
Bitcoin’s 50-week exponential moving average (WEMA) is back as support despite overall lower levels, and historically, this has been a key bull flag.
“In a sustained bull market, you can have a crash period which is very deep, but as long as this crash period maintains itself above this indicator of bullish momentum, the 50 WEMA, we can have that bullish momentum preserved and the price rally can actually continue afterwards,” he explained in a YouTube update on Monday.
As such, $30,000 may simply have been a “really hefty discount” rather than a bearish watershed for Bitcoin.