Bitcoin’s Upswing in Peril: Insights from Trading Veteran
Experienced trader Peter Brandt is cautioning that Bitcoin (BTC) might be on the brink of losing its bullish momentum in the aftermath of a broader correction across the cryptocurrency market.
Brandt, renowned for predicting the cryptocurrency market downturn in 2017, is expressing concern to his follower on X (Twitter). He emphasizes that Bitcoin is currently facing a potential risk of undoing the gains it recently made in its upward price movement as it approaches a critical price range.
The decline in Bitcoin $BTC is once again retesting the neckline on the underlying inverted H&S. A close below 24,800 (the low of the previous retest) would do damage to the daily and weekly graphs. But hey, what do I know? I am only a boomer who does charting. pic.twitter.com/Wj5JhFzNdZ
— Peter Brandt (@PeterLBrandt) August 18, 2023
In the previous month, Brandt shared a chart illustrating Bitcoin’s successful breakout from an inverse head and shoulders reversal pattern. This breakout occurred after Bitcoin crossed the price threshold of around $25,000, signifying a departure from the downtrend observed in previous periods.
Brandt explains that Bitcoin’s decline is undergoing a retest of the underlying inverted head and shoulders pattern’s neckline. Should the value fall below $24,800 (the previous retest’s lowest point), this could have a negative impact on the daily and weekly charts.
According to Brandt, the situation where the neckline of the inverse head and shoulders pattern is retested a second time raises the likelihood that the bullish reversal pattern might not hold.
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The trader also points out that Bitcoin has broken below a diagonal support level that had been instrumental in maintaining an upward trend since the beginning of the year. Brandt argues that Bitcoin is likely to remain in a bearish state unless there is a recovery of the upward trend line.
In the context of swing trading, Brandt would consider the trendline breach a significant development. As a result, his trading positions would lean towards either a short position or a neutral stance. A shift towards a bullish scenario would only be considered plausible if there is a genuine emergence of a bear trap.
Currently, the trading value of Bitcoin stands at $25,937, placing it above the neckline of the inverse head and shoulders pattern, although it is notably below the level of the diagonal support.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
