Bitcoin price on the verge of a breakout if this historical pattern repeats

Bitcoin price has been stuck in a tight range but historical trends and on-chain data suggest a breakout could be coming soon.

Bitcoin (BTC) has been trapped between highs of $84,000 and $82,000 with buyers finding it difficult to push higher. Although the market is still cautious, historical patterns and data point to the possibility of a breakout.

According to analyst Rekt Capital’s Mar. 18 post on X, Bitcoin’s current price action and its movement in June 2021 are similar. Following a steep decline, Bitcoin was trapped between the 21-week and 50-week EMAs.

It eventually broke out in late July and hit an all-time high in November. Currently, Bitcoin is once again in the same range, raising speculation that history could repeat itself.

Rekt Capital further observed that Bitcoin’s selling pressure has also been decreasing. Recent sell-offs have come with lower-than-usual volume, showing that sellers are losing momentum. This has opened the door for buyers, making last week a buyer-dominated period. Strong uptrends have resulted from similar shifts in previous cycles.

According to CryptoQuant, Bitcoin is currently undergoing a deleveraging phase, which involves the market’s excess leverage being removed. In the past, these phases have created short- to medium-term buying opportunities and paved the way for recoveries. Previous market cycles demonstrate that Bitcoin often sees strong price rebounds after leverage resets. 

The rise in the 3-6 month UTXO age bands, which indicate how long Bitcoin has been held, is another important indicator. CryptoQuant’s Mar. 15 analysis revealed that number of coins in this category is rising, much like what happened during the mid-2024 correction.

This suggests more investors are holding their Bitcoin instead of selling, reducing the available supply. In previous cycles, this type of accumulation has played a big role in forming market bottoms and driving new rallies.

Despite these positive signs, outflows from US-based Bitcoin ETFs have continued for the fifth consecutive week, which is the longest run on record. In April 2024, four weeks of outflows set the previous record.

Although this suggests short-term uncertainty, Bitcoin may be poised for a significant move if selling pressure falls and accumulation increases. A breakout could occur soon if previous patterns continue.