As Bitcoin Bounces Back Above $7K, Popular Analysts Say Monthly Close Is Pivotal

Bitcoin has charted a relief rally in the last 24 hours, yet it still needs to rise by more than $1,000 in the next three days to invalidate bearish pressures, according to prominent analysts.

"Bitcoin needs to close above $8,300 by the end of the month or we'll likely have a bearish December to test new lows," popular market analyst and Adaptive Fund partner, Willy Woo, tweeted during the Asian trading hours.

Essentially, bitcoin needs to rally more than 15 percent and print a UTC close above $8,300 on Nov. 30, or a bearish engulfing candle will be created on the monthly chart.

A bearish engulfing pattern consists of a green candlestick, representing a price gain, followed by a large down candlestick that eclipses or "Engulfs" the previous candle, as seen in the chart below.

Essentially, November's price drop has engulfed the October candle's body - the spread between open and close.

The bearish setup will be confirmed if bitcoin ends November below $8,300.

Sellers should observe caution even if the bearish pattern is confirmed - more so, as BTC has already dropped by more than 50 percent in the last five months and could recover some ground ahead of the miners reward halving, due in May 2020.While Woo is citing $8,300 as the level to beat for the bulls, Michael Novogratz, the billionaire CEO of Galaxy Digital, feels bitcoin needs to break above $7,500 to avoid being stuck in the less pleasant $6,000-$7,400 range.

The outlook will remain bearish as long as the cryptocurrency is trapped in a five-month falling trendline seen below.

A weekly close above the upper edge of the falling channel, currently at $8,990, is needed to confirm a bullish breakout, which, if confirmed, would mean a resumption of the bull market from lows near $4,100 seen in early April.

Realistically, bitcoin is more likely to form a bearish engulfing candle, as prices usually consolidate near lows for some time after a notable sell-off.