With Bitcoin’s price dip post-Fed still ongoing, a key contrary signal offers renewed hope, according to Godbole.

A key contrary signal is emerging, offering fresh optimism for Bitcoin bulls hoping for a resurgence toward six-figure prices.

Bitcoin (BTC) recently experienced a drop to $96,000 after the Federal Reserve’s decision, triggering a crucial contrary indicator that has traditionally marked the end of price pullbacks. On Wednesday, the Fed lowered the benchmark borrowing rate as anticipated but revised its outlook, now predicting only two rate cuts for 2025, down from the four it had forecast in September. Additionally, the central bank made it clear that it had no interest in participating in any government efforts to establish a strategic Bitcoin reserve.

Since the announcement, Bitcoin has fallen over 8%, dipping to around $96,000 at one point. At the time of writing, the cryptocurrency was trading around $97,500, down nearly 10% from its record high of $108,266 earlier this week, according to CoinDesk data.

This price drop has caused the 50-hour simple moving average (SMA) to fall below the 200-hour SMA, indicating a bearish crossover. While this pattern often suggests a continuation of the pullback, it hasn’t always been reliable during the recent bull market.

Bitcoin has encountered multiple pullbacks during its post-U.S. election rally from $70,000 to over $100,000, with each dip marked by a bearish crossover of the 50- and 200-hour SMAs.

Despite this, the latest crossover is providing renewed hope for bulls anticipating a bounce back into six-figure territory. A potential recovery could face resistance at $106,000, where a descending trendline meets the price action. A breakout above that level could pave the way for new all-time highs.

It’s important to note, however, that patterns don’t always play out as expected. The contrary indicator may not hold, leading to a deeper decline. A key level to watch is the recent low of $96,000, as a drop below that could open the door to further declines, potentially exposing the swing low of $91,000 seen on December 5.