Bitcoin (BTC) is still flirting with the top of a bull flag and trend suggests that a breakout could come as soon as this week. If the breakout occurs, where could Bitcoin head to next? A message to hold strong Michael Saylor, Chairman of Strategy, announced another huge Bitcoin purchase for his company on Tuesday. This time, it was 21,021 BTC for a price of $2.46 billion. Before announcing the purchase, Saylor put out an X post with an image of himself dressed as a cowboy on a horse. The statement with the image reads: “The cowards never started, and the weak died along the way.” This quote is popularly attributed to a historic migration route in the 19th century, called the Oregon Trail. It was also used in more recent history by the Nike founder Phil Knight in his book Shoe Dog. Here it was employed to galvanize the Nike team during a particularly challenging time. By utilising this gritty message from another era, Saylor is perhaps attempting to get the average retail investor to gird their loins and hang in there as far as Bitcoin is concerned. He is potentially saying that the “cowards” are those who can’t bring themselves to jump across from the fiat/banking world and into the transactional freedom of Bitcoin. He is also perhaps labelling the “weak” as those who couldn’t hang on to their Bitcoin and who sold on any of the market downturns. On the other hand, Saylor portrays himself as a dogged cowboy who endures until the end of the trail, made stronger by the experience and gifted by the rewards of rich land. While some might sneer and say that this just an effort at self-agrandizement, and although there is very little in common with a Bitcoin investor and a hard-bitten trail blazer in an extremely unforgiving environment, the message is clear - hold on through the volatile ups and downs of the market, and your reward could be great. $BTC breakout in one to three days Source: TradingView The $BTC chart pattern is continuing to evolve. While the price bounces around inside the bull flag, a trend line that stretches from price action inside the previous bull flag is perhaps corralling the price into a narrowing space. If the price continues to respect this trendline, a breakout should come within the next one to three days. In this case, it might not be the breakout of the bull flag, as the price could drop through the trendline and continue to go sideways. Measured move to $128,000 Source: TradingView The daily chart for $BTC shows the measured move of the breakout should this come to pass. It would take the price up to just above $128,000, potentially opening the route to $150,000 and beyond. However, if this trendline does not hold up, and the price falls back down to the bottom trendline of the bull flag, it could retest the 50-day SMA (blue line) and then be in prime position for an even stronger impulse to the upside. The Stochastic RSI on the daily time frame has the indicator lines bouncing along the bottom, ready to angle up and signal an increase in upside price momentum for the breakout. Concerns for the longer term momentum indicators? Source: TradingView With the weekly Stochastic RSI indicators now showing a cross-down from the top, some might be worrying that this could be signalling the end of this long period of upside price action. Also, with the 2-week Stochastic RSI indicators starting to get near the top, even more concern might be registering. However, one only has to look left to see that in 2023 the indicators stayed at the top for nearly six months, while at the end of 2023 and into 2024, the indicators were at the top for around three months. All one needs to know is that at least for the time being, the trend is still up, and there is likely to be more price appreciation over these next three to four months. After that things become a lot more uncertain, but with a possible blow-off top in the coming weeks, this should be plenty to concentrate on. Of course, like Michael Saylor, if you are in this for the next several years at least, this is all just noise. Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
