Bitcoin's price touched the lower trendline of its bear flag pattern on the 4-hour chart this week, putting the market at a clear decision point. The Fear and Greed Index has dropped to 23 (Extreme Fear), with readings making lower highs and lower lows similar to the 2021/2022 bear market. So far a proper bounce hasn't materialized, and failure to hold could lead to a collapse below the flag.
Bear flag on the 4-hour chart
The current bear flag pattern has been forming for roughly four months — about half the duration of a comparable bull flag that lasted eight months back in 2024. On the 4-hour timeframe, Bitcoin is sitting right on the bottom trendline. Shorter-term momentum indicators signal a potential upside bounce, but without a confirmed move higher, the risk of a breakdown remains real.
Extreme Fear deepens
The Fear and Greed Index at 23 puts the market solidly in Extreme Fear territory. The indicator's structure of lower highs and lower lows mirrors the pattern seen during the 2021/2022 downturn. That doesn't guarantee further downside, but it does suggest sentiment is still deteriorating rather than finding a floor.
Key support levels in focus
On the daily chart, the 100-day simple moving average is providing support — a level that previously acted as resistance. The daily Stochastic RSI is about to touch its bottom and could cross back up, potentially giving bears a reason to pause and bulls a technical catalyst. On the weekly timeframe, the RSI indicator line is passing through the support level of 44.80, a pivotal area that will likely determine the medium-term trend.
What a breakout would require
To reach the top of the large bear flag, Bitcoin would need to climb roughly $11,500 from current levels. That's a significant move, but the chart suggests the market won't stay indecisive for long. For now, traders are watching the lower trendline. If it holds, the setup favors a recovery toward the top of the flag. If it doesn't, the path of least resistance points lower.
