Bitcoin could hit $110k as strategy takes nearly 3x new BTC supply.
Bitcoin (BTC) is trading in a bearish flag pattern setting up a breakout below $50,000, or 30% below current levels. However, Michael Saylor's strategy could derail the Bears' plans.
Main Receptors:
Bitcoin has avoided a bear flag breakout for weeks as the strategy continues to buy BTC.
The setup now resembles Bitcoin's 2018 bottom, when a bearish pattern failed and a reversal was triggered.
Can the BTC buy strategy compensate for weak technicals?
Typically, a bear flag remains a bearish continuation pattern because there is not enough interest to overcome the broader downtrend.
In the case of Bitcoin, however, strategy is taking supply out of the market faster than miners can replace it.
Since March 2nd, the strategy's bitcoin holdings have increased by 46,233 BTC, while miners produced 16,200 BTC during the same period, which means it has almost tripled the new supply.
Much of that interest came through STRC, the strategy's variable-rate preferred stock. When STRC held a price equal to $100, Strategy continued to issue shares and accumulate BTC.
For example, last week, Strategy raised $102.6 million in STRC sales to fund over $330 million worth of Bitcoin purchases. Since then, BTC price has jumped over 6.65%.
On March 9-13, STRC sales rose to $776 million, enough to buy more than 11,000 BTC, while bitcoin rose more than 7% while the S&P 500 fell 1.6%. During the same period, the price of BTC increased by more than 10.5%.
But when STRC slipped below ideal in mid-March, supply cooled. Earlier subpar episodes coincided with BTC returns of 25%–40%, including a nearly 40% drop in the three weeks following the January break.
Bitcoin long-term holders and whales drove most of the selling.
A bearish flag failure could set up a rally around $110,000.
Bitcoin remains in a bearish bearish flag, but if the price breaks above the upper trendline near the mid-$70,000s, the pattern will begin to break down.
That breakdown would invalidate an immediate bearish continuation setup and shift focus to the bullish activity target near $108,000-$110,000.
A similar pattern failure occurred near the bottom of Bitcoin 2018, when a higher wedge pattern led to a breakout rather than a breakdown.
Another bearish upside is Bitcoin's position around the 200-week simple moving average (200-week SMA, the blue wave). In the year In 2018, Bitcoin dropped to this level and rose more than 1,975%.
In the year Since 2026, the 200-week SMA has successfully ended Bitcoin's downside tests, raising the chances of a 2018-style bottom formation.
RELATED: The Strategy STRC Stock Trading Rise: How Much Bitcoin Can Saylor Buy?
Some analysts predict that if Strategy continues to buy BTC at its current pace, BTC will rise to $400,000.
This article is prepared in accordance with Cointelegraph's Editorial Policy and is intended for informational purposes only. It does not constitute investment advice or recommendations. All investments and transactions involve risk; Readers are encouraged to do independent research before making any decisions. Cointelegraph makes no warranty as to the accuracy or completeness of the information provided, including forward-looking statements, and shall not be liable for any loss or damage arising from reliance on such content.
