By Ketki Saxena
Investing.com -- Bitcoin's current trading pattern, known as the "Bart Simpson" pattern, is indicating a potential shift in the cryptocurrency's price action, according to Daniel Kelly Kennedy, director of communications at Mercurity Fintech Holdings. The pattern, characterized by sudden price movements followed by periods of trading close to a particular price and ending with a sharp price movement in the opposite direction, has been observed since early June 2023 when Bitcoin was trading at $25,199.30.
The pattern started forming after a 20+% move on Wednesday, June 14, 2023. By June 23, Bitcoin hit the next level of resistance at $30,644.90 and has since consolidated in a tight range between $29,000 and $32,000 for over a month. According to Kennedy, if Bitcoin successfully breaks above the $31,500 mark in the coming days and manages to maintain that level, it could signify the start of a new bull run.
However, Kennedy also highlighted that it is important to distinguish real patterns from imagined ones. He believes that Bitcoin's recent price action is more related to fundamentals rather than minor news events or data points. He also noted significant historical support levels for Bitcoin around $30,000, $31,500 and $32,000.
Kennedy further explained that Bitcoin's price action has become less volatile and more predictable over time due to institutional investment. He predicted that the next bull run will be longer and more sustained with more controlled moves compared to previous spikes.
On July 3 and July 13 of 2023, Bitcoin attempted to test the key $31,000-$32,000 range but fell back each time. Kennedy suggested that another attempt is likely soon. If Bitcoin fails to break through the resistance again or loses momentum on its way up, it could sell off back down to $25,000 signifying a larger bearish reversal.
Despite this uncertainty, Kennedy remains optimistic about Bitcoin's future due to recent developments such as BlackRock (NYSE:BLK)'s ETF filing and Ripple's high-profile court win which may set a precedent for future litigation. However, he also acknowledged the possibility of Bitcoin retesting its previous bottom of $15,000 before the next bull run begins.