Bitcoin Teetering at Bear Flag Bottom: Imminent Crash Through to $75K or Lower?

Times look to be at their bleakest for Bitcoin. The $BTC price is currently at the bottom of a bear flag with a yawning chasm below. Is the king of cryptocurrencies about to fall in, or is there still the possibility of a recovery even now?

Bear flag could spell disaster

Source: TradingView

Bear flags are bad enough at the best of times, and with this current bear flag also having its bottom just below the major trendline, this one could spell disaster. 

If the $BTC price falls out of the bottom of the flag and confirms below, the least amount of damage is probably the measured move out of the ascending channel, which would potentially take the price down to around $75,500. 

Notwithstanding, if the bear flag plays out, the measured move would take the price down to the low $50,000s. This would be below the previous bull market top of $69,000, and would have pro-Bitcoiners scratching their heads as to what on earth could come next.

However, on the other side of the coin, if the $BTC price can bounce from the bottom of the flag/channel, and show that this is just a bottoming process that is playing out, the adamantine hands that are still holding could perhaps be proved right in the end.

Where there is life there is hope

Source: TradingView

The daily time frame helps to take out some of the noise, and here it can be seen that as things stand the current daily candle body might be peeping below the major trendline, but there is plenty of time left in the day for it to close back above. 

The downtrend line from the all-time high is not clear cut, and two possible lines can be drawn. The $BTC price remains above the inner but is a good way short of the outer trendline. This outer trendline needs to be broken through for the trend change to begin.

While there is life there is hope, and this is the case here, with the price just managing to hold at the major trendline, the bottom of the flag, and at the horizontal support level at $86,000. If these fail, the bull market probably fails with them.

A ray of hope is the daily Stochastic RSI, which shows its indicators approaching the bottom. A cross-up of the indicator lines is desperately needed here, and it needs to signal a much bigger bounce than up to now if the bulls are to extricate themselves from this highly perilous position.

Trendlines and horizontal support

Source: TradingView

The weekly chart also shows two trendline possibilities. Looking at the inner, faint dotted trendline, it can be seen that the $BTC price came down through this in mid-November. More touchpoints perhaps make this a more valid trendline. 

If an arguably more valid trendline has already been breached, and the price has confirmed at least 4 weekly candles below, the price could be in the process of making its way to a bottom. The thing is, where is that bottom? And could that just be a stopping point on the way to a much deeper correction?

The debate here so far has been all about trendlines. However, in technical analysis, while trendlines are undoubtedly very important, support and resistance levels have a lot more importance. 

If one looks at the macro price structure in the weekly chart above, it can be observed that if the price continues to fall it will meet with an extremely strong support band that really could be the make or break for Bitcoin. It is based on the previous bull market top of 2021, plus the top of the 8-month bull flag that stretched through much of 2024. As far as support levels go, this is as strong as it gets.

Will the $BTC price reach this level? This remains to be seen. That said, with all Bitcoin’s sound money properties and with the backdrop of major failing economies, if the price did get there, buying could be huge. 

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.