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Legendary market trader John Bollinger has shared some new insights into the price action of Bitcoin (BTC), the industry’s flagship asset that has witnessed a bearish correction for two days straight. Presenting a chart on X, Bollinger, renowned as the developer of the Bollinger Bands indicator, acknowledged that Bitcoin’s growth was very overextended and that a pullback was due.

The legendary trader shared a chat depicting the growth trends of BTC/USD from at least July 10. Within this time span, Bitcoin has seen a predominantly uptrend move, with momentum gained from mid-October to date. At the moment, the charts show that the Bitcoin price is currently diving away from the upper Bollinger Bands, showcasing an impending trend change. 

Though the current price is still far from the middle neutral band, John Bollinger said attention can now be placed on where the coin will register its support levels. With on-chain data always complementary to each other, the reversal in Bitcoin’s price at the $42,000 to $42,500 price range, as shown by John Bollinger, aligns with the resistance wall defined by Ali Martinez earlier.

While this reversal is considered a healthy play by most analysts, eyes are now set on whether or not BTC will fall back below the $40,000 range.

Contrasting technical and fundamental positions on Bitcoin

Bitcoin is considered to be overbought at the moment as the on-chain data suggest; however, the current fundamentals suggest that now might be the time to accumulate more of the premier currency.

Should the predictions of the approval window hold true, chances are BTC will record a more impressive uptrend if the United States Securities and Exchange Commission (SEC) approves a spot Bitcoin Exchange Traded Fund (ETF) product.

This remains the ultimate catalyst driving Bitcoin price sentiment, with the second being the hype around the forthcoming Bitcoin halving.