Current Situation
Bitcoin has taken a hit, dropping 7% to $59,478 last week. It’s since tried to recover but has been stuck between $60,100 and $62,300.
Bollinger’s Prediction
John Bollinger, the creator of the Bollinger Bands, believes Bitcoin will continue to consolidate. He sees no clear direction after a price reversal at the lower Bollinger Band.
What are Bollinger Bands?
Bollinger Bands show three lines: a middle line (20-day moving average), an upper line, and a lower line (plus and minus two standard deviations from the middle line). They help identify trends and potential breakouts.
Two-Bar Reversal
A two-bar reversal is a candlestick pattern that indicates a potential change in price direction. When it happens at the lower Bollinger Band, it usually means the asset might bounce back up.
No Bounce, No Bull Run
But in Bitcoin’s case, there’s been no bounce after the reversal. This suggests continued weakness or uncertainty, which could keep BTC consolidating.
Bearish Sentiment
Sideways price movements like this are often driven by bearish or uncertain feelings. Investors aren’t buying even at lower prices.
Weak Support
The lack of a price bounce also shows that the lower Bollinger Band is a weak support level. This increases the risk of a price drop.
Current Price
As of writing, Bitcoin is trading at $60,629, down 1.31% in the last day. However, its trading volume is up 15.95%.
Investor Confidence
Despite the recent dip, investors are still optimistic about a price rally. A crypto whale recently bought 20,200 BTC, showing confidence in Bitcoin’s ability to recover.
