Bitcoin Surges Past Bull Flag Target: $98K Projected
Bitcoin's price surge has led to a breakout from a bull flag pattern, with traders projecting it could hit $98,000. The cryptocurrency surged over 5% on September 21, reaching an intraday high near $85,285 and decisively breaking above the upper trendline of the bull flag.
The bull flag emerged after Bitcoin rallied almost vertically from around $62,500 in August to above $81,000, forming the 'flagpole.' The pattern was consolidated between two downward-sloping trendlines, creating the flag portion of the setup. Monday's advance confirmed an upside breakout from this consolidation range.
Bull flags are generally considered bullish continuation patterns. Traders calculate the upside target by adding the height of the preceding flagpole to the breakout point. In Bitcoin's case, the flagpole measures roughly $18,000-$19,000. Adding that distance to the breakout region around $79,000-$80,000 puts the technical target near $98,000.
Bitcoin has also moved comfortably above its major daily exponential moving averages (EMA). Its 20-day EMA sits near $78,633, while the 50-day EMA is around $74,929. The 100-day and 200-day EMAs are near $72,286 and $73,477, respectively.
However, Bitcoin's daily relative strength index has risen to around 72, entering technically overbought territory. This increases the possibility of a short-term pullback or consolidation before another advance.