This week will determine where BTC will trade to in the coming month

Bitcoin futures have been in a defined downtrend since the third week of April after hitting an all-time high in the middle of the month at approximately $65,000. In the following four weeks, BTC futures trade inside of a newly formed downward channel until mid-May when pricing fell outside of the channel, dropping from $46,000 down to $30,000 before making a shallow but swift recovery. Since that time, BTC futures have been trading inside their downward channel.

If pricing remains locked in this trajectory, it could trade as low as $20,000 by the start of July or as high as $42,000 while still remaining inside the current trend channel. So, while the broader outlook seems to point towards sideways pricing in the mid-term, BTC seems poised to break above a particular band in the channel that has been resistance over the past few weeks. Whether or not prices can effectively break above this band in the channel will likely determine whether the short-term outlook is bearish or bullish.

This band in the channel currently resides at $39,500, and a break above this level is quite possible this week and would be a very bullish signal for crypto futures. Should we see, pricing close above $40,000 sometime this week, expect $47,000 the following week.

A bearish scenario would unravel if pricing were to dip below $30,000, which could lead to a quick selloff all the way down to $24,000. This would take the bulls into Defcon 3 and accelerate the selloff in other cryptocurrencies as well. However, I feel this to be much less likely to play out over the bullish scenario.