The Bitcoin Downtrend Is Over

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The Weekly Downtrending Channel

Earlier this month, we focused on how Bitcoin could follow the red path to completion in an effort to position itself for a move across its black Downtrending Channel:

And last week, Bitcoin was positioning itself for a retest of the bottom of this black Downtrending Channel, to set up for a continued move via the red path:

A successful retest was important to reclaiming the black Downtrending Channel overall but also to enable a challenge and potential breakout beyond the Downtrend dating back to late July:

Since last week, Bitcoin has followed the red path to completion and then some, convincingly breaking this series of Lower Highs (light blue) in the process:

Bitcoin needed to Weekly Close above ~$61900 which was represented by the Downtrend and Bitcoin managed to do just that and more, Weekly Closing much higher than that price point.

Thus - the Downtrend is over.

However, whenever a Downtrend ends as resistance, there is always an opportunity for price to pullback into that old downtrend to turn it into a new support, so as to fully confirm the breakout.

For Bitcoin to experience such a post-breakout retest, price would need to drop into the ~$61300 area:

After all, this Downtrend is a dynamic resistance/support and so with each passing week, it will represent lower and lower prices, hence the difference in the price points it represented last week (i.e. ~$61900) and this week (i.e. ~$61300).

What's interesting about this potential retest is that the green 21-week Bull Market EMA is approximately confluent with that region:

Not only that, but the orange Pi Cycle MA is also located around that price region:

So there's a building confluence around that Downtrend area in association with a cluster of key Bull Market moving averages.

Thus, if Bitcoin were to dip in the short-term, it would be a means to an end in confirming the Downtrend as over and the new uptrend as underway.

However, it's important to note that this uptrend would likely see price try and revisit the black Downtrending Channel highs at ~$67000:

After all - the Channel Top is the main Downtrend that price needs to break in order to rally to new All Time Highs and beyond.

The fact that an intra-Channel Downtrend (light blue) has just been broken however is a good sign that price is getting ready to travel across the Channel.

Now it's just about Bitcoin trying to perform that move and it may involve some short-term dipping to fully confirming the swing to the Channel Top.