In an update on social media on July 16, the popular trader warned that the situation facing Bitcoin was fast becoming make or break.
Filbfilb: BTC nearing end of the compression phase
“BTC Bulls need to reclaim $9400 quick sharp,” he wrote in comments on a long-term price chart.
Attention focused on BTC/USD being stuck in a compression cycle which has lasted for multiple weeks. Compression refers to a pattern of higher lows and lower highs, with a trading corridor narrowing before a breakout.
For Bitcoin, the danger lies in a potential climax occurring in bearish territory as denoted by the Bollinger Bands volatility indicator.
Bollinger Bands consist of an upper and lower band surrounding a middle band and have historically captured both bullish and bearish moves by Bitcoin.
BTC/USD chart showing compression cycles. Source: filbfilb/ Twitter
“Coming to the end of consolidation/compression now.. doing so below the middle of the bbands is not typically a good sign,” filbfilb continued.
Should $9,400 reappear, he added, the outlook would be open to reinterpretation:
“Reclaim that level and happy to reconsider bearish bias.”
Eyes on $8,700 and below
As Cointelegraph reported, looking ahead, bearish scenarios now focus on levels below $9,000 — $8,700 and $8,200, the latter representing Bitcoin’s 20-week moving average.
“Bitcoin continues the slow bleed down towards 9k,” filbfilb told Telegram trading channel members earlier Thursday.
“Was pretty bad losing the $9,250 level; the weekly support and bottom of the range at $8,700 is looking increasingly likely to be tested.”
$9,000 support held up in early trading, with press time levels at around $9,080. BTC/USD remains vulnerable to stock market moves, with a fresh rout more than capable of sending the pair towards bearish targets.