The price of bitcoin remains locked in a chartist flag pattern that needs to break out to see further gains.
What does the future hold for Bitcoin?
In recent weeks, several technical and fundamental factors have converged to point to a continuation of the uptrend in Bitcoin and the crypto market as a whole. Among the most significant supporting factors are BTC’s positive correlation with global equity momentum and its inverse correlation with the US dollar and bond yields.
In addition, the growth in global money supply (M2) continues to boost available liquidity, a historical driver of risk appetite, from which Bitcoin benefits greatly.
The latest NFP report published on July 3 reveals that the US labor market remains resilient with an unemployment rate of 4.1% of the labor force, ruling out a US economic recession scenario. If this trend continues, the Federal Reserve may consider easing its monetary policy, but not before September. Such a move would reinforce the scenario of a prolonged bullish cycle for Bitcoin, with a potential peak expected by the end of 2025.
In this context, three chart patterns are particularly noteworthy:
1) Bitcoin: a bullish continuation pattern that must be broken to remain bullish
The daily chart for BTC shows a breakout from a bull flag, a classic technical pattern that accompanies prolonged upward movements. A breakout from this pattern would validate a theoretical target of between $125,000 and $130,000, as long as the price remains above the key support level of $105,000.
2) Bitcoin dominance: a bearish divergence looming
In terms of Bitcoin dominance (its share of the crypto market capitalization), a potential bearish divergence is emerging in the weekly data. If confirmed, this signal would indicate a gradual rebalancing in favor of altcoins, a prelude to what is commonly referred to as “altcoin season.”
Close monitoring of this indicator is therefore crucial to anticipate sector rotation movements within the crypto ecosystem.
3) Altcoins/Bitcoin ratio: a bullish signal awaiting confirmation
Finally, the ratio between altcoins (measured via the TOTAL3 index) and BTC is also showing an encouraging sign.
A bullish divergence appears to be forming on this ratio, and confirmation by breaking through a key technical resistance level would pave the way for a more pronounced rebound in altcoins relative to Bitcoin.
Historically, this type of configuration heralds the start of a phase of relative acceleration for alternative cryptocurrencies.
