Although Bitcoin (BTC) remains range-bound – trading between the $90,000 and $100,000 price levels – some crypto analysts predict that a price correction may be on the horizon due to a bearish ‘head and shoulders’ pattern forming on the daily chart.
Bitcoin To Drop To $80,000?
Seasoned analyst and trader Aksel Kibar took to X to share his thoughts on the recent BTC price action. In his post, the chartered market technician highlighted a potential head and shoulders pattern forming on the daily BTC chart, with risk of the cryptocurrency dropping as low as $80,000.
The analyst explained that the pullback could push BTC’s price to the broadening pattern that completed with a breakout above $73,600. However, Kibar emphasized that the head and shoulders pattern must fully materialize for a significant pullback in BTC price to occur. He stated:
Seeing it is not enough. It needs to materialize with a breach below the neckline. There are many cases of failed head and shoulders tops especially in steady uptrends well above the year-long average.
Other crypto analysts have also shared similar bearish outlooks for Bitcoin’s price. For instance, technical analyst Ali Martinez identified $92,730 as a crucial price level for the top cryptocurrency. According to Martinez, losing this level could push BTC into “free fall territory,” based on UTXO Realized Price Distribution (URPD).
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For the uninitiated, URPD is a metric that shows the distribution of Bitcoin’s Unspent Transaction Outputs (UTXOs) across various price levels, based on when they were last moved. Essentially, it helps identify price zones where significant BTC accumulation or spending occurred, providing insights into investor behavior and market sentiment.
In addition, former Wall Street derivatives trader Tone Vays warned that BTC trading below the $95,000 price level would be “very, very bad” for the flagship digital asset. Similarly, renowned trader Peter Brandt recently highlighted the risk of BTC breaking down from a ‘broadening triangle’ formation, potentially falling to the $70,000 level.
While several analysts predict a potential price correction, others remain optimistic about Bitcoin’s long-term trajectory. Thomas Lee of Fundstrat Capital projected that BTC could surge as high as $250,000 by 2025. However, he acknowledged the possibility of a short-term correction to $60,000 early next year before Bitcoin enters a historic bull run.
The Long-Term Bullish Case For BTC
While BTC may indeed face a looming price correction according to some analysts, the long-term price projections remain overwhelmingly bullish. Crypto asset manager Sygnum posits that BTC may face ‘demand shocks’ due to strong institutional interest in the asset, driving its price significantly higher.
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Earlier this month, Ali Martinez highlighted the potential formation of a ‘cup and handle’ pattern on BTC’s chart. If this pattern plays out, it could trigger renewed bullish momentum for the digital asset. At press time, BTC trades at $94,149, down 2.5% in the past 24 hours.
Featured image from Unsplash, Charts from X and TradingView.com
