Bitcoin is currently hovering in a tightly compressed price range after failing multiple times to break above $110,000 earlier this month. The past few days have been characterized by the leading cryptocurrency trading around $105,000, with neither bulls nor bears taking control. Despite the overall consolidation, a subtle yet significant signal is starting to flash beneath the surface, particularly on the 4-hour chart, that might send Bitcoin to a new all-time high soon.

Return Of Rare Divergence Pattern On Bitcoin’s 4H Chart

Crypto analyst Luca (@CrypticTrades_) took to social media platform X to share a chart that highlights an important technical development on Bitcoin’s 4-hour timeframe: the return of a bullish divergence. This signal, which previously appeared in early April, preceded the massive rally that catapulted Bitcoin to its May 22 all-time high of $111,800. The same divergence is forming once again and another Bitcoin price breakout may be very close.

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As shown in the 4-hour candlestick timeframe chart below, the divergence is clearly illustrated between price action and the Relative Strength Index (RSI). Price has been forming lower lows, while the RSI has been printing higher lows. This mismatch serves as an early indicator that selling momentum is fading, and a reversal to the upside could follow. The previous instance of this pattern directly preceded a sharp move from a $74,000 low in early April to above $111,000 in just a few weeks.

What Does This Divergence Mean For Bitcoin’s Price?

Bullish divergences on mid-timeframe charts like the 4-hour have a reputation for being the first reversal signals when supported by rising volume. In Bitcoin’s current case, the appearance of this pattern again could mean that the recent retracement from $111,800 has run its course. With RSI now trending upward even as price presses slightly lower, Bitcoin may be witnessing another hidden accumulation phase before its next leg higher.

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If the pattern holds true to its previous performance in April, the leading cryptocurrency could be setting up for another push toward new all-time high levels. Bitcoin is currently not far off from a new all-time high, as it is only about 5.5% away from its price peak. Based on this, another strong breakout could easily aim beyond the previous $111,800 high. 

Although Bitcoin’s price is relatively stagnant for now, the presence of this bullish divergence is a reminder of how quickly things can change. The previous bullish divergence ended up with a 50% price surge. A similar performance from the current price level would translate to another target above $160,000.

At the time of writing, Bitcoin is trading at $105,700, up by 1.4% in the past 24 hours, already showing signs of the bullish divergence signal coming into action.

Featured image from Getty Images, chart from Tradingview.com

Crypto analyst Kevin Capital has suggested that the Bitcoin price may be in trouble. This follows his revelation that a bearish pattern that once led to a market crash in the last cycle has returned for the flagship crypto. 

Bearish Divergence That Led To Market Crash Returns For Bitcoin Price

In an X post, Kevin Capital revealed that the bearish divergence that led to the market crash in the last cycle has returned for the Bitcoin price. He highlighted how bearish this pattern is, noting that the only chart that keeps him up at night at the moment is the bearish divergence on the weekly time frame for BTC. 

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He noted how this pattern formed for the Bitcoin price at the same time it did in the last cycle, causing a big dip back then. However, the crypto analyst then alluded to what happened after the market crash as BTC recovered following this period. As such, he suggested that there was no need to be worried although he advised market participants to prepare through it if this bearish pattern plays out this way. 

However, amid the revelation of the bearish pattern, crypto analyst Titan of Crypto has provided some optimism for the Bitcoin price. In an X post, he stated that BTC’s mark-up phase is beginning and that the short consolidation appears to be wrapping up. His accompanying chart showed that BTC could rally to as high as $117,000 next. 

Crypto analyst CobraVanguard also provided a bullish outlook for the Bitcoin price. He stated that BTC has entered an ascending phase after its cup-and-handle formation at $105,000. He predicted that the flagship crypto could rally to as high as $123,000 following the formation of this bullish pattern. The crypto analyst also predicted that BTC could top around $260,000 in this market cycle. 

Monthly Close Provides Bullish Outlook For BTC

The January monthly close has provided a bullish outlook for the Bitcoin price. In an X post, crypto analyst Mikybull Crypto noted that the good monthly close has invalidated the shooting star candle. He added that the cycle top is not in yet based on this. His accompanying chart showed that BTC could rally to $144,129 soon enough. 

Meanwhile, prior to the monthly close in January, Titan of Crypto mentioned that the Bitcoin price looks strong on the monthly chart from an Ichimoku perspective. He added that the price is holding above all lines, with both the lines and Kumo cloud trending upward. There is also a lot of optimism heading into February, as this month is historically bullish for the crypto market. 

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At the time of writing, the Bitcoin price is trading at around $102,400, down over 2% in the last 24 hours, according to data from CoinMarketCap. 

Featured image from Pixabay, chart from TradingView

Jamie Coutts, the chief crypto analyst at Real Vision, has highlighted an indicator that paints a bullish picture for Bitcoin (BTC). Based on this indicator, the crypto analyst suggested that a reversal might already be on the horizon for the flagship crypto. 

Bitcoin Hashrate Decline Is Slowing

Coutts mentioned in an X (formerly Twitter) post that Bitcoin’s hash rate decline is slowing, which he noted usually precedes a bottom ad reversal of the bearish cross, which happened after the halving event. He, however, warned that a bullish reversal still depends on a “stabilization in the downtrend.”

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The crypto analyst further noted that the percentage difference between the 30- and 90-day moving averages aligns with previous hash rate contractions and isn’t as severe as the post-2020 halving. A slowdown in Bitcoin’s hash rate decline is significant because it suggests that miners’ capitulation may be ending soon. 

Crypto expert Willy Woo previously mentioned that the market will recover when “weak miners die, and hash rate recovers.” He further explained that inefficient miners will have to go into bankruptcy while other miners are forced to purchase more efficient hardware.

Cryptoquant’s CEO Ki Young Ju has provided insights into when this miners’ capitulation might end. He stated that it usually ends when the daily average mined value is 40% of the yearly average. The crypto founder further revealed that it is currently at 72%, suggesting that it could still take a while before miners eventually cool off on offloading their reserves. 

Ki Young Ju told market participants to expect the crypto markets to be dull for the next two to three months. He urged them to stay long-term bullish but avoid excessive risk. Crypto analysts like Mikybull Crypto have also assured that Bitcoin’s long-term outlook is bullish as the flagship crypto is still far from its bull market peak. 

Market Still Recovering From Supply Overhang

Coutts also mentioned that the market is still recovering from the supply overhang. This is in relation to the selling pressure that Bitcoin experienced thanks to the German government, which offloaded nearly 50,000 BTC on the market. As such, it could take a while for the market to suck up this Bitcoin supply. 

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While this selling pressure has negatively impacted the market, Coutts stated that the distributions of the German government sales and Mt. Gox reserves can help remove the “annoying supply overhang.” The analyst noted that this would happen through distributing these coins to a wider array of holders, which would, in turn, grow the Bitcoin network and leave the flagship crypto even better off than before. 

At the time of writing, Bitcoin is trading at around $58,300, up over 2% in the last 24 hours, according to data from CoinMarketCap. 

Featured image created with Dall.E, chart from Tradingview.com

Winklevoss twins who are the founders of the cryptocurrency company Gemini got their excess Bitcoin donation to Donald Trump’s presidential campaign returned because the contributions they made exceeded the maximum legal limit.

Cameron and Tyler Winklevoss each contributed $1 million in Bitcoin to the Trump campaign, a contribution that exceeded the $844,600 limit for individuals to contribute to political campaigns.

Winklevoss Brothers Trump Bitcoin Campaign Donation Returned

A campaign official, speaking anonymously, clarified that the excess amount was refunded to the Winklevoss twins, each $ 155,400. However, whether the refund was in Bitcoin or its cash equivalent remains to be determined. The Trump campaign has accepted Bitcoin donations, reflecting the former president’s embrace of the cryptocurrency community. 

The contributions are divided among Trump’s campaign, his leadership political action committee, the Republican National Committee, and 42 state GOP committees.

Such donations arrived as Trump sided with the crypto community and voiced against the democrats’ efforts to regulate the industry. The Winklevoss twins, who are also known for their Bitcoin investment, have openly supported Trump and labelled him as a “pro-Bitcoin” and “pro-crypto” candidate.

Regulatory Challenges and Industry Relations

Gemini, a crypto exchange founded by the Winklevoss twins, has also been through some regulatory challenges such as a settlement with the U. S. and New York state financial regulators and a lawsuit by the Securities and Exchange Commission (SEC).

Nevertheless, the Winklevoss brothers still stand for Trump and consider him as the protector of the crypto industry from regulatory actions. Some activities that demonstrate Trump’s crypto friendship are his meetings with Bitcoin miners in a recent round table.

Although Trump has been charged with 34 felonies and has faced numerous other legal issues, he still leads the Republican presidential race. His engagement with the crypto industry is a part of a larger effort to garner support from the business community and tech elites. This approach is different from the current administration led by the President Joe Biden as the Winklevoss twins and other enthusiasts of the cryptocurrency have alleged that the administration is against the industry by coming up with regulations.

Crypto PAC and Electoral Influence

Likewise, Stand With Crypto PAC has also turned out to be quite active in endorsing the candidates who support the cryptocurrency business.

This PAC has endorsed 18 candidates for the upcoming elections, pointing to the increasing political power of crypto voters.

The PAC stated that over 52 million people in America own digital currency, and a majority of them want a new financial system. This group is a swing vote, with several stating that they would not vote for politicians against cryptocurrencies.

Read Also: Pro-Bitcoin Donald Trump Declares Himself “Crypto President”

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Kelvin is a distinguished writer specializing in crypto and finance, backed by a Bachelor’s in Actuarial Science. Recognized for incisive analysis and insightful content, he has an adept command of English and excels at thorough research and timely delivery.

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.