The price of Bitcoin (BTC) has consolidated sideways for several days in a row and July 5 is no different despite modest losses.
Why is Bitcoin price not moving?
BTC price dipped over 1% to around $30,350 on the day. Still, its price action remained flat overall, and within the range of the past two weeks, between $31,400 and $29,500.
The consolidation period follows Bitcoin’s 27% price rally from its June low of around $24,750, showing that traders have less urgency to buy or sell BTC in the short term.
The daily relative strength index (RSI) has inched closer to the “overbought” threshold of 70 as of July 5, which can at least partially explain the sideways price action. An overbought RSI typically leads to the price either consolidating sideways or correcting lower.
In addition, the market may have been weighing the prospects of the U.S. Securities and Exchange Commission (SEC) approving the region’s first spot Bitcoin ETF against the Federal Reserve’s hawkish tone.
On June 30, the SEC called the Bitcoin ETF applications filed by BlackRock and other top financial institutions “inadequate.” Since then, Bitcoin’s trading range has narrowed further, with the short-term support line shifting toward $30,500.
More gains for Bitcoin in July 2023?
From a technical perspective, Bitcoin appears well-positioned to continue its rally further into Q3 despite the slight intraday losses.
Notably, the ongoing BTC price consolidation has painted what appears to be an ascending triangle, a bullish continuation pattern in an uptrend. This will be confirmed if BTC/USD manages to break above the triangle’s upper trendline and rise by as much as the pattern’s maximum height.
In other words, BTC price could rally toward $37,000 by July or August, up around 18.5% from the current price levels.
Related: Bitcoin futures premium hits 18-month high — Time to flip bullish?
On-chain indicators also show decent chances for an upward BTC price scenario
For instance, as of July 5, BTC’s long-term holders’ market-value-to-relative-value (MVRV) ratio was recovering from its undervalued levels (the green zone in the chart below). Similar actions in the past have preceded bull cycles.
Conversely, failing to decisively break above the $31,500 resistance level can have the price test the lower bound of the range at $25,000-26,500 over the next few weeks.
The range target coincides with Bitcoin’s 50-week exponential moving average (50-week EMA; the red wave) and its 200-week EMA (the blue wave).
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
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