Bitcoin (BTC USD) faces the possibility of a bearish head-and-shoulders (H&S) pattern, according to renowned financial analyst Peter Brandt.
This pattern, visible on Bitcoin’s daily chart, could push prices down to $73,000 if confirmed, amplifying concerns amid already turbulent market conditions.
The warning comes during a period of heightened market volatility, with Bitcoin losing over 6.5% of its value in the past three days.
Brandt Highlights Head-and-Shoulders Formation on Bitcoin (BTC USD) Chart
Peter Brandt posted his thoughts on social media, noting that a potential head-and-shoulders formation may be appearing on the daily Bitcoin (BTC USD) chart.
He noted, however, that the pattern has not been fully developed and its completion could result in a sharp price drop.
“The daily chart is tracing out a head-and-shoulders top this pattern might take prices to $73,000, or it might morph into something else,” he said.
– Advertisement –
Brandt also pointed out that chart patterns are not static and the trader should not over rely on any one chart pattern.
He also pointed out that the use of charts is to time the occasional asymmetric risk rather than to figure out the exact price action.
His insights are shared at a time when Bitcoin is struggling to hold support levels as other markets also stabilize.
Ali Martinez Warns of Additional Bearish Risks
Crypto analyst Ali Martinez also shared similar opinions with Brandt saying that Bitcoin has now dipped below a significant barrier region of $95,400 to $98,400.
Martinez said that this zone has been a busy one earlier at which 1.53 million Bitcoin (BTC USD) were bought by about 1.77 million addresses. The breakdown of this level has opened up further downside pressure on the asset.
According to Martinez, once the price dipped to $91,200, it became a critical support level, and a break below $92,000 could lead to a tumble to $74,000.
He said that there is not much volume between these levels because Bitcoin has been going up very fast during previous market euphoria. With current holders possibly having to sell in order to avoid losses, the prospects for more selling pressure arise.
Market Volatility Creates Doubt for Bitcoin (BTC USD)
Bitcoin has been trading with increased range-bound volatility in the recent past, with the cryptocurrency touching a low of $94,500.
This is particularly so in light of the recent spill in the stock market, which saw its worst performance since September, and which must have had a negative impact on investors’ outlooks.
The current total market cap of cryptocurrencies has plunged by almost $400 billion in the last 36 hours, pointing to aggressive sells across the market.
This bearish trend is not only evident in Bitcoin. Other cryptocurrencies like Ethereum (ETH), Binance Coin (BNB), Dogecoin (DOGE) and Solana (SOL) have also lost more than 8% in the same period.
The coordinated drop further exposes the overall market and points to the dominance of Bitcoin in guiding the market directions.
Head-and-Shoulders Pattern: What It Could Mean for Bitcoin
The head-and-shoulders pattern that is characteristic of bearish market reversals has also worried the analysts.
If confirmed, the pattern could lead to a price drop to $73,000, in line with Brandt’s observations.
The neckline of the pattern and the trading volume shall be important in deciding whether the pattern will be fully realized.
However, Bitcoin (BTC USD) chart patterns are not definitive, as Brandt has repeatedly emphasized. He explained that patterns can “morph” over time, making them unreliable for precise predictions.
Despite this uncertainty, the current pattern has prompted traders to brace for the possibility of a deeper correction.
