Bitcoin’s Weekly Journey: The Spike and The Barrier
$30K – A Matter of “When” or “If”?
Earlier this week, Bitcoin shot up to a high at $29,900, only to close around $28,500, creating a massive spike on the charts. After a brief moment of indecision, the bulls resumed their control and the apex currency is now changing hands at $29,400.
The story of the spike is relatively straightforward: Monday, BTC’s price rocketed due to a mistaken report claiming the Securities and Exchange Commission (SEC) approved the first Bitcoin spot ETF.
The false news came via an X (formerly Twitter) post from the crypto news outlet Cointelegraph. Bitcoin’s price approached $30,000, leading to hundreds of millions in liquidations. However, BlackRock and others refuted this claim, with Cointelegraph later apologizing for spreading incorrect information because of a mistake by their social media team. Cointelegraph pledged to reevaluate their internal protocols.
Somebody probably lost their job… But then again, this just goes to show how easily the crypto market can be influenced. Remember what Elon Musk’s tweets did to Bitcoin a while back… or to DOGE? If one post from a news outlet created such a massive spike, just wait and see until a deepfake Jerome Powell comes out and says the Fed is ditching the Dollar and making Bitcoin official tender in the U.S. But I digress; let’s see what’s next for Bitcoin.
Chart Analysis – BTC/USD
The elephant in the room is the barrier at $30,000. This year, Bitcoin flirted with $30K several times, to the point where “getting a room” should have been the next step. Okay, less fantasizing about the romance between a cryptocurrency and a horizontal level, and more chart talk:
In April, BTC/USD touched $30K for the first time but the price was overextended and the RSI was showing bearish divergence. The level held strong but in late April and early May, we saw two other attempts to break the level.
These two failed attempts were followed by a deeper dive that found support at $25,000. From there, Bitcoin traveled once again to $30K, this time breaking it and reaching the year’s high at $31,818. The high price couldn’t be sustained and the pair moved once again to the support at $25K, bringing us to the current timeframe when BTC is once again flirting with $30K.
The year’s price action thus far has created a double bottom at $25K, and a Head and Shoulders pattern overall. The former is a strong bullish pattern (it already pushed the price to $30K) and the latter is a bearish pattern. However, if the year’s high will be broken, the Head and Shoulders will be invalidated.
In the short term, BTC/USD is approaching overbought (RSI close to 70), so we might see a pullback soon. If that is followed by a break of $30,000, the next question will be whether we can see a new yearly high in the next couple of months, or not.
