Coinbase Premium's Triangular Convergence Hints at a Major Potential Bitcoin Price Move

Similar Coinbase Premium patterns led to all-time highs during the 2021-2022 bull market.

Bitcoin price has seen a 2.28% rise in the last 24 hours, recovering from a sharp decline and showing a promising sign of climbing back up.

After hitting a local low of $55,629 on Monday morning, Bitcoin began to rise and reached $58,401 by press time. This recent rise follows a steep decline last week, where BTC fell to as low as $52,732. As Bitcoin continues to trade below the crucial $62,000 price level, questions remain about whether this recovery will lead to a sustained rally or another dip.

However, data from the Coinbase Premium is hinting at a potential major price move in the coming days.

Coinbase Premium suggests a major price move coming up

One key indicator that analysts are watching is the Coinbase Premium, which reflects the price difference between Bitcoin on Coinbase and Binance. According to the latest 1-hour Coinbase Premium chart, the volatility in the premium has decreased, and both the upper and lower bounds of the price range are converging into a triangular pattern.

This pattern is often seen as a sign of an imminent major price movement, especially when it occurs after a period of high volatility.

Historically, during the 2021-2022 bull market, a similar triangular convergence was observed in the Coinbase Premium before Bitcoin surged to new all-time highs.

If this trend holds, the narrowing price gap could indicate that the market is finding its fair value, and a decisive upward or downward move is likely on the horizon.

Large investors, such as over-the-counter (OTC) desks and институты, might be engaging in a standoff before the next big shift in Bitcoin’s price.

Bitcoin still in a bear phase

It’s important to note that, despite the recent gains, BTC is still in a bear phase as it trades below the $62k price level.

Bitcoin’s market value to realized value (MVRV) ratio has been below its 365-day moving average since August 26, signaling bearish market conditions.

Analysts suggest that this bear phase could delay any major rally unless Bitcoin breaks out of this consolidation.