FX.co ★ Bitcoin: new flag pattern

The price of bitcoin is trading in the red at 43,904 at the time of writing. The cryptocurrency is in a corrective phase after registering a strong swing higher. Technically, a temporary decline was somehow expected. The price action developed a down channel, a flag formation that may represent an upside continuation pattern.

In the last 24 hours, BTC/USD is down by 4.48% and by 7.43% in the last 7 days. Bitcoin's drop forced the altcoins to drop as well.

BTC/USD Upside Continuation Formation!

BTC/USD escaped from the up-channel signaling potential downside movement. Now, it reached the flag's downside line which stands as a downside obstacle. False breakdowns below this obstacle may announce a potential bullish momentum.

Technically, a valid breakdown below the channel's downside line could open the door for a larger drop. The current flag could represent a bullish continuation pattern. Still, this is far from being confirmed.

Bitcoin Outlook!

After retesting the broken uptrend line, BTC/USD was expected to drop. Now, it has reached support. Staying above the channel's downside line may signal a new leg higher. Still, only a valid breakout above the flag's resistance, above the downtrend line could confirm an upside continuation.