Bitcoin Price Holds Above $3,700 But Bulls Need Progress Soon

View Bitcoin's defense of $3,700 is encouraging, but a positive follow-through is needed soon to invalidate a bear flag pattern that has developed on the hourly chart.

A UTC close below $3,714 would validate Sunday's bearish outside reversal candle and confirm a bullish-to-bearish trend change.

The probability of BTC closing today below $3,714 would rise if the cryptocurrency drops below $3,764 in the next few hours confirming a bear flag breakdown.

A bear flag breakdown, if confirmed, would open the doors to levels below $3,400.

The leading cryptocurrency by market capitalization created a big bearish outside reversal candle on Feb. 24, weakening the bullish case put forward by last week's high-volume breakout above $3,800.

So far the bulls have not taken advantage of better entry levels offered by Sunday's price drop, leaving the cryptocurrency directionless around $3,800.

So an upward move is needed soon, as the short duration technical studies are turning bearish and a break below $3,700 could yield deeper losses.

An hourly close below $3,764 - the confluence of the lower edge of the flag and the rising trendline - would confirm a flag breakdown and, with RSI back in the undersold territory, there is enough room for a drop to levels below $3,400 post-breakdown.

A UTC close below $3,714 would validate both the downward sloping 100-day moving average and Sunday's bearish outside day candle and confirm a short-term bullish-to-bearish trend change.

The probability of BTC witnessing a bearish close below $3,714 would rise if prices confirm a flag breakdown with a move below $3,764 in the next few hours.