Bitcoin could be going through a trend that hasn't been seen in seven years. The bitcoin seems to be forming a rising wedge which could be a bearish pattern. But the interesting thing is that recently for bitcoin, it's bearish patterns have been turning bullish.
Bearish patterns in a very established uptrend tend to exhibit this. We can't say for sure whether it would break down or not, the chances of a serious dip could be anywhere from 30-70%. We are in a strong bullish trend and that hampers the possibility of this current trend turning or staying bearish.
I always think that it's riskier to bearish on bitcoin than bullish, it's riskier to sell than to buy bitcoin. Though if the bitcoin were to dip now, it would decline by maybe 20% to retest the $20,000 level. If it turns out that it surges higher instead, it could hit the $43k or even the $41k level.
I think there is a real probability of this happening. We could see it climb up to at least $40,000 and at most, even $45,000. If we break out at the $38,800 levels that this would happen. But we could breakout at much higher levels and then we would have to watch out for new levels.
Let's look at the RSI, which is an indicator of oversold and overbought territory. Bitcoin is currently at a value of 95 approximately bearing in mind that a hundred is the maximum which means that 95 is very close to maximum overbought.
We are currently higher than the last time we saw a similar trend back when it broke its ATH, in the past years. The highest at that time was 93.7, and bear in mind there we saw an 85% correction after that, which is somewhat scary. So for those who are just jumping on the bitcoin investing ship, we could see a huge correction before bitcoin goes back up again.
According to the charts, every time we go into overbought territory, we always come to see a correction. So the correction would happen, the only question is when and how much correction we are going to see. I think a 50% correction is likely. But the only thing is that we are still in an uptrend, the daily ribbon, weekly ribbon, the moving and four-hour average all say the same; we are in an uptrend. Even the parabolic runup hasn't been broken yet.
So, Yes! for now, bitcoin is still looking bullish.
