Bitcoin is once again pressing against the lower boundary of a multiyear rising wedge pattern — a technical formation that has acted as support since mid-2017. The level sits around $70,000, and a confirmed break below it could, according to one analyst, produce the largest weekly red candle in the asset's history.
The pattern that's held since 2017
The rising wedge is formed by two converging upward trendlines. Bitcoin has touched the lower line during previous stress events — $15,400 during the FTX crash in November 2022, and again at $60,000 (Feb), $64,900 (Mar), and $65,000 (Apr) this year. Each time, the level held. Now, with the price back near $70,000, traders are watching whether it breaks for good.
Analyst MichaelXBT warned this week that a decisive break below $70,000 could trigger a cascade of selling. A wedge breakdown typically signals that the prior bullish momentum has exhausted itself, and the lower boundary has been tested multiple times — each test weakens the support.
What the analysts are watching
Michaël van de Poppe offered a more tempered read. He describes the current weakness as a standard end-of-month correction driven by asset manager rebalancing, not a structural breakdown signal. But he also notes that Bitcoin faced rejection at $77,000 and that if key support fails, prices could slide into the low $60,000 range — essentially a retest of the levels seen this spring.
The timing isn't great. Volume has been thinning into month-end, and liquidity in order books tends to drop when fund managers shuffle positions. That can exaggerate moves in either direction.
The rebalancing theory
Van de Poppe's argument is straightforward: institutional portfolios are rebalanced at month's close, which often means selling some of the winners (crypto) to buy laggards or meet redemption requests. That selling pressure is temporary. If the support holds through Friday's close, the pattern could resume its uptrend.
But the wedge is tightening. The lower boundary is rising — from $65,000 in April to roughly $70,000 now — while the upper boundary is flattening. That means a breakout, or a breakdown, is likely soon. The market will have an answer by early next week, when monthly settlement is behind us.
