- Bitcoin is consolidating below $106000 as price moves inside a descending triangle formation since May.
- Sellers capped gains at $108000 while $104000 support continues to hold as the triangle nears its apex.
- The 21MA now blocks upside pressure and a strong move is expected once either side clearly breaks.
Bitcoin is consolidating below $106,000 within a descending triangle, trading just under the 21-day moving average (21MA) on Binance. This moving average now acts as immediate resistance, capping any potential upside in the short term. At the time of analysis, Bitcoin’s price is hovering near $105,509, reflecting minimal daily change of +0.09%.
The consolidation suggests growing market indecision. Buyers have defended the $104,000 support zone multiple times, while sellers continue to cap upside near the triangle’s resistance. This structure could soon lead to a strong directional move, depending on whether price breaks above resistance or falls below support.
A key question now faces market participants: Will Bitcoin confirm a bullish breakout or trigger a deeper selloff from this pivotal pattern?
Price Action Forms Tight Descending Triangle
Bitcoin has been trading in a well-defined descending triangle since late May, showing lower highs but steady support around $104,000. This pattern typically signals weakening bullish momentum as each rally fails to set a higher high. Traders closely watch this structure as it tightens further into the apex.
The upper resistance trendline, connecting lower swing highs, currently intersects just above the $108,000 mark. This level, together with the 21MA, creates a dual resistance barrier that has suppressed recent bullish attempts. The inability to close above this zone suggests limited buyer conviction at present.
However, on the downside, the horizontal support zone at $104,000 continues to hold firm. Multiple daily candles have bounced off this level, indicating active accumulation. If this support cracks, the descending triangle would likely resolve to the downside, possibly accelerating selling momentum.
21MA Signals Barrier Above Short-Term Momentum
The 21-day moving average has become a crucial technical marker, acting as dynamic resistance over the last several sessions. Bitcoin is now trading slightly below this average, with each attempt to reclaim it quickly fading. The average currently sits around $105,700.
For a bullish breakout to gain traction, price must first clear this moving average with a decisive close above it. Such a move could invite renewed buying pressure and push the price toward the triangle’s upper resistance near $108,000. From there, a breakout may establish a fresh bullish leg.
Failure to reclaim the 21MA would indicate short-term weakness and increased risk of a bearish continuation. Traders often use this average as a momentum filter, and the current setup implies downward bias unless flipped into support.
Breakdown Could Trigger Swift Downside Extension
If Bitcoin breaks below $104,000 support, the pattern would shift bearish, likely opening the door to lower price targets. A daily close beneath this support would confirm breakdown from the descending triangle, a historically bearish structure.
Such a move may push Bitcoin to test psychological levels near $100,000 or lower, depending on selling volume. In past cases, triangle breakdowns have led to sharp downward legs, especially in low-volume environments. Traders are cautious of this setup, watching for signs of stronger bearish volume.
Currently, the volume remains subdued, suggesting a lack of conviction on both sides. Still, tightening ranges tend to precede volatility. A move beyond the triangle will likely set the tone for the next directional phase in Bitcoin’s price action.
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