A crypto analyst has pointed out that Bitcoin’s failure to break above higher resistance levels has resulted in the formation of a “double-top price pattern,” indicating a possible “steeper decline” to $50,000.
Markus Thielen, the founder of 10x Research, noted in a recent analyst note that Bitcoin is currently testing its support level and appears to be following a double-top pattern. This pattern occurs when the price reaches two similar peaks with a slight dip in between, while maintaining support above a common line called the “neckline.” Typically, this pattern resolves when the price breaks below the neckline, potentially leading to a decline equal to the distance between the peaks and the neckline.
According to Thielen, this chart formation could result in a drop to $50,000 or even $45,000 if it is not invalidated. Despite potential positive factors like the U.S. elections and the Consumer Price Index later this year, Thielen warned that the price could still experience a significant correction.
Prominent crypto traders have been discussing Bitcoin’s price action following the halving event on April 20, which reduced Bitcoin miner block rewards by 50%. Some traders believe that Bitcoin’s price is still following a similar pattern to the 2016 halving cycle and is currently consolidating around previous cycle highs.
While some traders are offloading their holdings at current prices, others like Rekt Capital see potential for further upward movement in the short term. Rekt Capital suggested that the market is around 40% through the “bull market” phase, indicating that the recent drop in Bitcoin price below $60,000 could present a buying opportunity before Bitcoin enters a “parabolic uptrend.”
It is important to note that this article does not offer investment advice or recommendations. All investment and trading decisions come with risks, and readers are advised to conduct their own research before making any decisions.