The Bitcoin bulls have broken out of the bear flag on Monday and have tested $80,000. Is this a firm foothold for the price so the bulls can push on higher, or is this just the last dregs of a rally that is just about to run out of steam? A hold above the bear flag is critical Source: TradingView The short-term time frame for $BTC reveals that the price has just broken out of the 3-month long bear flag, although this is only on a 4-hour candle as yet. The price has pushed through the top of the bear flag and has tagged the $80,600 resistance , before coming back to test and confirm the breakout, and what could now become support at $79,500. All looks good so far. A hold above the top of the bear flag for the next two or three days is probably what is needed now. Even better would be a surge well up above the flag, so that when the next down move comes, there is room for the price to come back down without breaking back into the flag. Could this be another small fakeout, as happened on 22 April? Quite possibly. This is a time when momentum could falter suddenly, especially if news from the Middle East is not good. Bulls not destined to be successful? Source: TradingView When zoomed out into the daily time frame the delicate nature of the situation can be fully understood. If this is to be a breakout, we are in the very early beginnings of it. We won’t know until the end of the day if the $BTC price is going to close above the top of the bear flag. Even now, the price looks to be sinking back below. While a golden cross has just taken place (the 50-day SMA crossing above the 100-day SMA), the big give-away here that tells us that the bulls are probably not destined to be successful, is the lack of any kind of volume to accompany a breakout. Until such time as we see some decent-sized volume bars, a breakout is not going to be likely. A descending volume profile while the price is rising is not a good sign. Finally, here in the daily time frame we can observe that the RSI indicator has reached the descending trendline again . This trendline goes all the way back to November 2024 so it is very strong indeed. Yet another rejection of this trendline is quite likely. Weekly macro picture still negative Source: TradingView Positives in the weekly time frame are that the $BTC price has broken through the bear market trendline and has left it well behind. In the RSI, the indicator line is just peeping through the descending trendline (although this is very early in the week). Nevertheless, the negatives are still controlling the macro picture. The trend is still down, and the $BTC price has been unable to break out of the top of its bear flag thus far. The macro take-away from this chart is that a rejection from the top of the bear flag is probably the next move to occur. Does this mean that a crash could then follow? Not necessarily. It may just mean that the price needs to come back down to the bottom of the bear flag. 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.
