BTC – “Potential Bearish Flag in development”

4-Hour Analysis:

Big Picture: The attempts at recovery were short-lived since bulls failed to capitalize. As a result, the consolidative environment has persisted. Bitcoin is now resting on trendline support. This will be a critical level for the price since failure to hold it could trigger a massive sell-off, which will be supported further by the possible bear flag. To negate such a scenario strength above 23,650 is required.

On the Upside 21,750 once again restricts the recovery as price remains unable to trade above it. To extend the upside further breaking through this level remains necessary. Successfully doing so would open 22,200, followed by 22,450. These resistances are also significant price barrier. If this level is successfully recaptured, it will almost probably spark aggressive short-covering, pushing the price even higher towards the 22,800-23,000 range.

On the Downside prices are being held back by support at 21,350. Below this level, a possible important level in the form of trendline-based support exists. The level is now around 21,200, although this trendline has been in place since mid-June. Loss of this level could be a major setback for bulls, extending the fall further, first to 20,750-20,400, then to 19800 and towards deeper lows.