Bitcoin price momentum builds after Dragonfly Doji forms near 20-day EMA support
BTC forms bullish Dragonfly Doji near golden ratio at $105,900
Bitcoin price continues to hover within a narrow consolidation range, leaving traders questioning when the next decisive move might occur.
Over the past four days, the cryptocurrency opening and closing price has found itself trapped in tight sideways trading conditions, specifically between the levels of $103,750 and $105,900. These price boundaries are significant because the upper edge at $105,900 coincides exactly at the 0.618% Fibonacci retracement of the previous bullish swing that pushed Bitcoin to its all-time high of $112,000.
Highlights
-Bitcoin forms a bullish Dragonfly Doji near the Fibonacci golden level at $105,900
-Daily RSI supports continued upside if consolidation resolves to the upside
-4-hour chart shows EMA resistance and neutral RSI demanding stronger bullish confirmation
The recent price action, though largely sideways, offers some compelling insights. Notably, Tuesday's daily session produced a Dragonfly Doji candlestick pattern, a widely recognized bullish reversal signal. This pattern generally emerges at the lower end of a retracement or during periods of consolidation, highlighting a potential shift in sentiment from bearish to bullish. The appearance of this Dragonfly Doji signifies that despite limited movement, buying interest is steadily building, suggesting traders are becoming optimistic about a near-term upward breakout.
BTC price dynamics (May - June 2025). Source: TradingView
This bullish sentiment briefly materialized early in Wednesday’s Asian trading session as Bitcoin surged above the top of its consolidation range to mark a five-day high near $106,450. However, this optimistic move quickly fizzled out, and prices retraced back within the established range, currently trading near $105,400 during today's European session. Although this decline is evident, Bitcoin remains supported technically by the 20-day Exponential Moving Average (EMA), which is playing an active role in stabilizing current price action.
Bitcoin's 4-hour RSI neutrality and EMA pressure highlight short-term indecision
From a broader viewpoint, the daily Relative Strength Index (RSI) remains supportive of a bullish continuation scenario, reinforcing the optimism built by the recent Dragonfly Doji and consecutive bullish closes over the past three trading days. Should bulls regain momentum, Bitcoin would first need to conquer and sustain above the Fibonacci 0.618% level at $105,900, subsequently targeting the critical 50% Fibonacci retracement level at $107,000. Achieving this breakout would strongly affirm the continuation of the broader bullish trend.
Conversely, the shorter-term 4-hour chart provides a note of caution. The 50 and 100 EMAs at this timeframe currently act as formidable resistance precisely at the 0.618% Fibonacci level of $105,900. This resistance area must be convincingly surpassed to avoid renewed bearish pressure. Additionally, the 4-hour RSI, currently at neutral, tells of market indecision at this critical juncture, and places emphasis on the necessity for bullish momentum to emerge decisively in the near term.
Bitcoin price dropped to $104,750 and tested the key Fibonacci zone before rebounding. A death cross on the 4-hour chart increased the risk of further decline.
