Currently, Bitcoin (BTC) is exhibiting a downward trend in its pricing, potentially heading towards the $91,000 mark, a level not seen since late November 2024. Is this a harbinger of a more significant price drop to come, or will the bulls manage to turn things around and prevent it?
The overall feeling towards Bitcoin is mainly cautious, with hints of anxiety, and a sudden drop below $91,000 might trigger panic selling. If this occurs and the price also falls beneath the long-standing uptrend line from 2021, things could get quite intriguing.
It seems that the general consensus on social media is leaning towards taking profits from Bitcoin and altcoins, as several analysts believe the recent peak in Bitcoin’s price might be followed by a downturn, suggesting caution when holding these positions.
Head and shoulders pattern – is the writing on the wall?
It appears that a head and shoulders chart formation might materialize. We’ll have to wait and see if the price ends up closing beneath the support line, which happened as I was writing this. However, keep in mind that the day isn’t over yet, and the price could still move up or down before it does. A daily close below the support would likely indicate whether this pattern will continue or be disproven.
Descending triangle?
One additional benefit for the bears is that the market’s trend might be shaping up as a descending triangle. This pattern occurs when the price hits successively lower highs, while the lows remain fairly stable. If the bulls manage to prevent a significant price drop at this point, sustained sideways movement could potentially lead to this specific situation unfolding.
In simpler terms, if either of two bearish situations occur, the price might drop to $75,000, which isn’t much lower than the peak of the last bull market at $69,000. If it reaches this level, another confirmation wouldn’t be catastrophic unless it fails and a potential bear market follows.
$85,000 is the next support level
Looking at Bitcoin (BTC) on a daily scale, it’s important to understand where we stand. The price is currently touching an upward trendline, meaning it could either rebound from this point or potentially drop to significantly lower prices if it breaks below.
As an analyst, I observed that the price dropped below the 50 Simple Moving Average (represented by the blue line) a week ago and appears primed to potentially slide further towards the 100 SMA (the green line). This descent would align with the 0.382 Fibonacci Retracement level at approximately $85,700. In the event of an extended downtrend, the price might reach the 200 SMA, which currently stands around $74,000.
Put the bearishness aside
Regardless of the current pessimism, if we disregard that and consider the possibility of the price dropping to the 100 Simple Moving Average (SMA), this would merely represent a retracement to the 0.382 level, which could be interpreted as quite optimistic, given it’s still within a bullish range.
It’s likely we’re in the late stages of the bull market for Bitcoin, with its most dramatic growth potentially yet to be seen. In a week, Donald Trump will assume office, which could provide significant momentum to Bitcoin’s price. It would take a lot of confidence to bet against the potential future rise.
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2025-01-13 18:11