Bitcoin Faces Its Moment of Truth After Weeks In Suspense – Will Bulls Finally Break Through To New Highs?

John Smith

Bitcoin has been coiled like a spring for almost 3 weeks, bouncing between support and resistance in an excruciating consolidation. After repeated tests of the $38K ceiling, analysts say Bitcoin may be ready to break out in an explosive move – the only question is which direction.

As the cryptocurrency holds its breath, bulls and bears are at a faceoff that could determine Bitcoin’s trajectory in the critical holiday season. The foundations may now be laid for BTC to surge to new heights – or face yet another harsh correction. Either way, experts agree something has to give soon.

Buy Walls Stack Up As Short Sellers Capitulate

Since its retreat from highs of $69K in November 2021, Bitcoin has seen its share of volatility. Yet despite recent ranging, BTC appears to be strengthening its position for further upside. After three weeks oscillating between support and resistance, bears are losing steam while dip-buyers only grow more ravenous.

According to Alex Kuptsikevich, senior market analyst at FxPro, Bitcoin is trapped in an ascending channel, bouncing between support that creeps gradually upward and resistance at $37.8K. While repeated tests of thisstubborn ceiling have so far been harshly rejected, Kuptsikevich notes that pullbacks from it are becoming “less deep over the past three weeks.”

This buoyancy suggests bullish conviction is accumulating with dip-buyers unwilling to let BTC drop far before scooping up more. Their efforts are paying off – shattering the morale of short sellers, who are now capitulating en-masse according to data from analysts Skew. Bybit and Binance futures platforms show huge unraveling of short positions, opening room for more upside.

Ascending Triangle Targets $45K Breakout

The strengthening floor holding up Bitcoin combined with a clear horizontal resistance is forming what’s known as an ascending triangle. As buys overwhelm sells into each dip, BTC bounces ever quicker off its rising support line underneath resistance at $38K.

According to respected technician Charles D. Kirkpatrick II, ascending triangles typically resolve with a bullish breakout 77% of the time. The height of the triangle pattern projects a potential move upwards equal to 61% the length of the base – putting Bitcoin’s target at $45K if support keeps lifting price to break past $38K resistance.

That target aligns neatly with analyst Markus Thielen’s estimate. As head of research for Matrixport, Thielen sees Bitcoin charging up on a textbook ascending triangle breakout to surge as high at $45K – if it finally powers through the latter half of November’s highs.

December Historically Bullish For Bitcoin

While far from guaranteed, conditions are ripe for Bitcoin to push bulls into the driver’s seat headed into December – a month typically quite generous for BTC buyers.

Crunching the numbers, Matrixport found Bitcoin’s December returns have averaged a hefty 12% over the last 8 years running. If that seasonal strength plays true for 2022, Thielen suggests Bitcoin could rise as much as $42K under December trends alone.

Whether history repeats or not though, analysts universally agree something needs to happen soon. Bitcoin can’t range sideways in this ascending channel forever. Eventually buyers must overwhelme sellers to break resistance, or vice versa to collapse the floor.

Which way will Bitcoin break? After weeks building pressure, experts say the cryptocurrency could now erupt in either direction. But with shorts panicking to unwind positions as dip demand racks up, odds seem to favor the buyer’s side for the next major move.

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John Smith is a veteran stock trader with over 10 years of experience in the financial markets. He is a widely followed market commentator known for his astute analysis and accurate predictions. John has authored multiple bestselling books explaining complex market concepts in simple terms for novice investors looking to grow their wealth through strategic trading and long-term investments.
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