Bitcoin price fails at $9,000 as sellers eye $8,000 next

Bitcoin’s move higher has stalled at $9,000, opening the door for a pullback towards $8,000. This failure to clear $9,000 may prove to be costly for the world’s largest digital coin, as traders were betting on a potential bullish pennant chart formation. 

Fundamental analysis: Whales moving their assets in anticipation of the halving event

The crypto community is eagerly anticipating the next bitcoin halving event, which will cut the future bitcoin supply in half. In essence, the miners will see their rewards drop from 12.5 bitcoin to 6.25 bitcoin per block. 

Given that the supply is shrinking, this event is generally considered to be bullish for the bitcoin price. Traditionally, Bitcoin price has gained in the anticipation of the halving event, with traders hoping for a move above $10,000 this month. The halving event is expected to take place in the second week of May. 

In addition to the general bullishness connected to the halving event, it seems that large bitcoin owners, the so-called “whales”, have been moving their assets recently. Online bots that track the movement of whales picked up a transfer of around $50 million worth of tether tokens to a major crypto exchange Binance on Wednesday.

Technical analysis: A failed bullish pennant?

Whether Bitcoin moved higher due to the halving event or whales moving their assets is less important. The move that Ardoino is referring to saw Bitcoin gain more than 13% on Wednesday, helping the coin make a new 2-month high on the next day. 

This move higher has also created a base for the potential formation of the bullish pennant chart pattern, which is considered to be a continuation pattern that helps extend the uptrend higher. The bull pennant consists of two phases - the explosive move higher (the flagpole) and the consolidation phase (wedge/triangle).

However, the buyers failed to break the pennant and therefore facilitate the activation of the bullish flag pattern. In case they were successful, the completion of the bullish pennant chart pattern would point to a move towards $10,500.

Given that the bull pennant failed to materialize as the wedge was broken to the downside, this has now opened the door for a pullback toward the $8,000 support. This is home to a 50% retracement of the Wednesday - Thursday move and where 100 DMA and 200 DMA meet together, and provides a solid opportunity to buy Bitcoin from a risk-reward perspective.

All in all, Bitcoin price may still move north of $10,000 in the coming days and weeks, but a pullback is a more likely scenario in the short-term, given the failure to break above $9,000.

Summary

Bitcoin exploded higher on Wednesday as traders eagerly anticipate this month’s halving event. However, the buyers have failed to sustain the positive momentum and secure a breakout above $9,000, paving the way for a pullback towards $8,000.