Bitcoin price is back above $ 56,000 after a bull-bear tug-of-war resulted in a stalemate as the April month draws to a close.
The monthly candle at the current level is closed as a Doji, signaling indecision and a possible reversal. Here's a closer look at the possible reversal pattern where crypto bears are looking for cheaper coins in the coming days.
Bitcoin bears take on bulls, rally reaches breakpoint
It's hard to be bearish on Bitcoin at all, let alone now. The cryptocurrency has gone from pennies to over $ 60,000 per coin. The tight BTC supply suggests that this is still very early and much more ROI can be expected, so that prices of hundreds of thousands each may be reached in the future.
The whole of 2021 so far has been like a rocket ship for Bitcoin and its altcoin brothers. Ethereum and Dogecoin have massively outperformed the top cryptocurrency, and some others have done it even better.
Related reading | Bitcoin Price Forecast: Cloudy with a prospect of downward movements
Bitcoin profits that are carried away and poured into altcoins are just one of many reasons why the leading cryptocurrency by market cap is taking a hiatus. Incredibly overheated technical indicators and the sudden fear of impending regulation coupled with a huge capital gain tax hike on the horizon are also to blame.
The indecision has resulted in the crucial April monthly monthly candle being close to forming a doji when it closes at 8 p.m. ET tonight.
The month should close as a Doji but there is a risk of reversal | Source: BTCUSD on TradingView.com
Potential reversal patterns for evening stars could mean the lights out for Crypto Bulls
A doji is either a sign of indecision before a trend continues or a signal that a reversal is near. But it all depends on what comes next after the doji is formed. If another massive surge follows in May, the bull trend will be back in full swing.
However, if bears get the best price action in the next month and close with another red candle, there is a risk of an evening star pattern.
Related reading | Potential island reversal leaves Bitcoin bulls stranded
An evening star reversal is a Japanese candlestick pattern that forms when a steep rise is covered by a doji, followed by a similarly strong depiction of the bears down.
The May red candle must devour at least 50% of the historic March candle to be confirmed. If May closes below $ 50,000, there is a serious risk of another downtrend in the upcoming top cryptocurrency.
The reversal pattern also occurred in the same month when a rare “pi cycle top indicator” triggered its signal for only the fourth time in Bitcoin's history.
Featured image from Pixabay, charts from TradingView.com