The short version is a minor bounce is possible around $65,500, a retest of $60,000 is likely, and if that breaks the conversation shifts to $50,000 and potentially lower.
The Bearish Flag Nobody Wants to Talk About
Bitcoin is forming a textbook bearish flag. A move lower followed by sideways choppy price action inside a narrow range. The pattern mirrors what played out from the all-time highs earlier this year and historically bearish flags resolve to the downside.
“It is very rare when you get a bearish flag that you do not at least test the low of that move to the downside,” he said.
The Four Levels
The MicroStrategy Question
The conversation turned to Michael Saylor after Strategy disclosed its first Bitcoin sale in three and a half years. The sale was small but the symbolism was significant.
A small sale is manageable. A billion-dollar sale would be a different situation entirely. Strategy currently holds approximately $63 billion in Bitcoin accumulated at an average price of around $75,000, well above current levels.
“If he ever has to liquidate he will seriously hurt Bitcoin for all of us,” Soloway said. “He has put himself in a position where if margin call type scenarios ever come into play that could be cataclysmic.”
Strategy’s stock has a critical trend line around $105 per share. A break below that level would imply Bitcoin at $60,000 and approaching $50,000 simultaneously.
