Bitcoin (BTC) is forming a bullish flag – buy or sell?

A lot of nervousness and general fear has made its way into the cryptocurrency market as Israel and Iran face off and investors may brace for more potential tit-for-tat blows. Bitcoin appears to be taking advantage of the more bearish sentiment to move sideways and to the downside. However, the resulting chart pattern is likely to be a very bullish bull flag.

Fear Pervades Markets

Times are uncertain. Across traditional markets, the overall sentiment is one of “fear,” with the S&P 500 down 4.2% and the Nasdaq 100 down roughly the same.

In the crypto space, things aren’t going so well either. While the Fear & Greed Index remains in “greed,” Bitcoin has fallen another 16% since April 8, having ended a 17.5% decline in early March. Luckily, there was a bounce in the middle, so BTC did drop down to the $60,000 support level again.

Source: Coingecko/Trading View

Bull Flag Formation

One ​​good thing about Bitcoin’s up and down swings is that this depicts a bull flag pattern in technical analysis. If BTC is able to hold the $63,000 support level, or even drop to the low $60,000s, this simply confirms the bottom of the bull flag.

Also, if BTC decides to break out to the upside, the longer BTC stays inside the bull flag, the more explosive its move could be. The measured swing for the bull flag would be $96,000.

Bearish Scenario

On the other hand, if BTC price breaks below the base of the flag and breaks support all the way down and breaks below $59,000, the next stop could be a sharp correction to $51,000. This would represent a 30% reversal if this is the route Bitcoin chooses.

Traders and investors are probably pretty nervous right now. Inflows into US spot Bitcoin ETFs have really dried up over the past week or so, with the Grayscale ETF (GBTC) losing money tipping the dollar scale in favor of BTC outflows rather than inflows.

Fortune is gained and lost in times like these

Watch for any new conflict developments on one hand and the decline in traditional stock markets on the other, and there could be more pain ahead for Bitcoin and the cryptocurrency market.

However, one might ask, does Israel really want to endanger itself by launching another tit-for-tat strike against Iran? Even the most ardent warmongerer must realize that there are no winners if the conflict escalates in this way.

So with this in mind, the time to buy may be when everyone else is bearish and selling. Does fortune favor the brave, or is investing in a potential war downright foolish? In times like these, fortunes are won and lost.

Disclaimer: This article is for informational purposes only. It does not provide or is intended to be used as legal, tax, investment, financial, or other advice.