Bitcoin has moved out of a downtrend and now trades above $109K as it heads toward key resistance.
Traders are watching the $100K level as the breakout matches earlier 2020 pump correction patterns.
RSI divergence near current price suggests short-term pressure may rise while trend support remains firm.
Bitcoin is currently trading near $109,579 as it tests major resistance after breaking out of a multi-month downward price channel. Technical patterns from early 2024 and comparisons to late 2020 suggest the setup resembles a pre-pump correction. The logical breakout point stands near $100K, with current structure signaling either acceleration or rejection.
Source: X Rounded Bottom Structure Echoes 2020 Pre-Rally Conditions
The chart outlines a rounded bottom pattern forming between March and September, aligning with price behavior from late 2020. This earlier structure led into a steep upward breakout, followed by consolidation and continued rally through early 2021. Price behavior then mirrored a strong accumulation base, confirmed by tightening support levels.
A yellow arc marks the initial accumulation curve that formed from May to August, which served as the launchpad for the next leg. Support held consistently at key trendlines, building pressure against a descending resistance that has now been invalidated. After multiple tests, Bitcoin finally broke above this neckline in mid-October.
The early signs of a broader uptrend became visible as RSI trended higher, peaking during price breakouts. A similar pattern has developed in the current cycle, with rounded bottom support aligning with mid-range trendlines and rising RSI levels. Traders may view this as a continuation pattern, especially with price structure respecting the green ascending base trend.
Breakout From Downward Channel Sends Price Toward $112K
The white price line shows that Bitcoin recently exited a downward-sloping blue channel. This breakout appears to confirm renewed bullish momentum, with the next visible resistance target marked near $112,000. A green arrow above the upper trendline projects further gains if resistance fails to hold.
The previous touchpoints of this channel show consistent rejection until the breakout. A similar setup occurred in mid-2023, which led to a swift $20,000 upward movement. Now that the price has cleared the top range, the market is closely watching the sustainability of this breakout.
Volume and relative strength index (RSI) both show divergence. RSI shows a slight bearish divergence at the top despite price rising, suggesting weakening momentum. This development may limit upside temporarily or result in a retest of previous resistance zones near $104,000.
The horizontal projection labeled “100K” remains a psychological level that could influence both buyer and seller behavior. Any clean move above it may lead to stronger breakout confirmation, especially with the current market structure forming an ascending wedge.
Will Bitcoin Rally Early or Stall at Resistance?
As the price moves out of the channel, one question emerges: will Bitcoin confirm a breakout or pause at major resistance?
The chart’s orange resistance line has historically capped price near $112,000. A break above it could signal the start of a stronger rally phase. RSI divergence, however, poses a cautionary note as momentum appears to weaken slightly.
Green trendlines from 2023 have remained unbroken throughout multiple correction periods. This consistent base support gives the breakout further validation if price holds above $108,000. The repeated bounce off these levels supports the thesis of an early breakout cycle.
A rising pattern and rounded cup structure suggest potential continuation. Historical context from late 2020 adds to this scenario. If the $100,000 level breaks cleanly, momentum could take Bitcoin toward its next structural resistance without major rejection.
