Analyst Kevin Svenson, Bitcoin (BTC)$BTC
The technical analysis pattern that caught Svenson’s attention is a “falling wedge” formation on the four-hour chart. This pattern is generally considered a sign of a strong rally, and Svenson has made important predictions about Bitcoin’s current state.
Falling Wedge Formation and Its Meaning
A falling wedge is a technical pattern that shows that the asset price has been under downward pressure for a period of time, and that the momentum of sellers has diminished. In this pattern, the price is trapped within a narrowing range, creating lower highs and lower lows. However, when this pattern is completed, an upward breakout is usually expected. In other words, the most important indicator of a falling wedge is that the selling pressure has ended and buyers have re-entered the market. Svenson states that Bitcoin may have reached a local bottom by creating this pattern, and that an upward movement may be inevitable from here on.
According to Svenson, if the stock market remains stable, Bitcoin is expected to complete this formation in the short term. The analyst, who also stated that the price could fall a little more, emphasized that Bitcoin could experience a significant recovery from this level based on the general functioning of the formation. "If these levels remain as the bottom, the completion of the falling wedge formation could start a nice recovery movement in Bitcoin," he says.
At press time, Bitcoin is trading at $62,717, suggesting that BTC has broken out of the falling wedge formation and started an upward move. This breakout suggests that the Bitcoin price has started to rise again, with buyer momentum replacing seller pressure.
On the other hand, Svenson emphasizes that for this breakout to be sustainable, Bitcoin needs to continue to create “higher lows” on the daily chart. This indicates that Bitcoin’s price will continue to find support at certain levels and the market can maintain its stability and continue its upward movement.
Svenson also warns that a break below $57,000 could lead to new selling pressure. This level stands out as one of Bitcoin’s long-term trend lines. A close here could cause the market to remain under selling pressure for a while. “The low I don’t want to see is around $57,000,” he says, adding, “If we get down to that trend line and there’s a break here, the situation could get dangerous.”
Stating that Bitcoin needs to overcome important resistance points in the recovery process, Svenson emphasizes the importance of staying above the $62,000 level in particular. A permanent move above this level would be a strong sign in Bitcoin's recovery process. If this happens, he states that Bitcoin's next target could be $90,000.
Considering the crypto market dynamics, Bitcoin completing this strong technical formation and breaking upwards could create significant opportunities for large investors and institutional investors. According to Svenson, Bitcoin’s current price movements could be a precursor to a larger market rally. However, as always, it is important to remember that there are uncertainties and risks in crypto markets.
