Bitcoin’s (BTC) price has been in a downtrend throughout June, as Q2 ended down nearly 18%. However, according to technical chart patterns, BTC’s price could be on track for a breakout. How long will the current consolidation last?
Bitcoin consolidation could be ending — Wyckoff pattern
Technical analysis using the Wyckoff method points to a potential end to the current Bitcoin price consolidation.
Based on the Wyckoff pattern and decreasing Bitcoin exchange reserves, BTC could be gearing up for a breakout, according to crypto analyst and CryptoQuant contributor Onchain Edge.
The analyst wrote in a July 2 post:
“If the reaccumulation phase continues, we could expect a breakout upwards (markup phase) as the next step in the Wyckoff cycle.”
Wyckoff accumulation is a classic technical analysis setup named after Richard Wyckoff, a technical analysis pioneer in the first half of the 20th century who broke down the market cycle into four distinct phases.
Onchain Edge also pointed out that the falling Bitcoin exchange reserves suggest that we have entered the reaccumulation phase. He wrote:
“Decreasing exchange reserves suggests accumulation as BTC moves off exchanges. This is consistent with the reaccumulation phase… The exchange reserves have been decreasing for a while. This means BTC is being moved off of exchanges which indicates confidence among holders.”
Related: XRP price could break out as open interest increases
BTC price monthly downtrend could be over — Analyst
According to popular crypto analyst Rekt Capital, Bitcoin has potentially broken its month-long downtrend after falling over 7% during June.
The analyst wrote in a July 1 X post:
“Has Bitcoin broken its June Downtrend (light blue)?”
Over on the daily chart, Bitcoin is seemingly forming a technical chart formation known as a bull flag, which suggests further upside momentum, according to the analyst:
“The Macro Higher Low is confirmed and Bitcoin is now rallying to the upside. Bitcoin is developing a Macro Bull Flag.”
Based on technical chart patterns, Bitcoin’s price could reverse and break out to the $90,000 mark in the following months, according to popular analyst Titan of Crypto, who shared the below chart in a July 2 X post.
Bitcoin could see significant selling pressure in July
However, traders should be mindful of more potential selling pressure from a German government-labeled wallet that moved nearly 6,500 BTC on June 19.
In its latest move, the wallet transferred $52 million worth of Bitcoin on July 2 and still holds over 43,850 BTC worth over $2.75 billion.
This type of selling pressure, paired with other macroeconomic factors, could overpower Bitcoin buyers, according to Kristian Haralampiev, structured products lead at Nexo, who told Cointelegraph:
“Bitcoin’s current consolidation phase is driven by various factors that need resolution for the asset to appreciate. Currently, selling pressure from government bodies, such as recent sell-offs by Germany, could suppress investor activity.”
Bitcoin could also see selling pressure from the Mt. Gox creditor repayments, expected in early July.
More than $9.4 billion worth of Bitcoin is owed to approximately 127,000 Mt. Gox creditors, who have been waiting for over 10 years to recover their funds. This could mean that many investors will likely cash out after a decade of untouched profits.
Related: Bitcoin ETFs legitimized the crypto industry for investors — Storm Partners
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.