Bitcoin is currently facing challenges as it attempts to break above the $23,100 mark, with many experts in the crypto community warning of a potential “bull trap” scenario. Is there a truth to their assumptions?
Let’s find out!
The bitcoin rally last week saw many people turn bullish on the asset. Indeed, many altcoins did pump, with APTOS gaining the largest percentage among the large cap alts. While the DOJ crackdown on Bitzlato slowed down the rise of Bitcoin, a further push from the bulls jolted it past the $22k resistance. However, the asset has hit a snag.
Several attempts at breaking above $23,100 mark have resulted in failure, leading some to think the much anticipated bull trap is finally mature.
Where is Bitcoin Headed?
On the four-day chart, it appears that Bitcoin has retested a potential bear flag pattern. If this pattern plays out, it could indicate that the current price is the top. Some people believe that Bitcoin could reach 25,000 or 30,000, but this depends on the performance of traditional markets. If stocks see an increase, it could be a bullish sign for Bitcoin.
The market does not appear strong enough for Bitcoin to reach 30,000. The idea that the current uptrend could be a major “bull trap” may have some truth to it. Some of the major price increases appear suspicious, particularly when there is a spike in activity during weekends when trading volume is low. This is supported by the bearish divergences seen in the relationship between price and volume, which suggest that it is artificially being manipulated.
DISCLAIMER: The work included in this article is based on current events, technical charts, company news releases, and the author’s opinions. It may contain errors, and you shouldn’t make any investment decisions based solely on what you read here.
Vincent Munene is a freelance writer and a great blockchain enthusiast. Blockchain has changed his life in terms of financial freedom and in return, he likes to educate people and keep them up to date on everything blockchain. He is a Biochemist by profession and also loves to play the piano.