Is Bitcoin Facing a Major Correction or a New Bull Run?

Bitcoin’s Potential Showdown: Will $150,000 Remain in Sight?

As Bitcoin (BTC) faces turbulent waters, market sentiment is shifting rapidly. The cryptocurrency’s recent surge to a record high of $112,000 has raised hopes among investors for an optimistic $150,000 target by year-end. However, the swift correction below $105,000 is testing those bullish narratives and raising questions about Bitcoin’s near-term trajectory.

Bearish Trends and Turning Points

Recent analysis suggests Bitcoin may be forming an inverse cup-and-handle pattern, with critical support resting around $100,800. As of June 7, this formation indicates that a breakdown beneath this threshold could lead to a significant decline, potentially targeting $91,000. This anticipated pullback aligns with Bitcoin’s 200-day exponential moving average (EMA), increasing the likelihood of further downward momentum.

The relative strength index (RSI) has also declined alongside Bitcoin’s price, underscoring the conviction of traders participating in the ongoing sell-off. With the RSI at 52, a slip below 50 could tighten the pressure even more on Bitcoin’s price. To stabilize its position, bulls will need to reclaim resistance at the 20-day EMA, currently around $105,000. Failure to maintain these price levels could diminish prospects for reaching that coveted $150,000 milestone by the end of 2025.

Historical Patterns Resurface

Turning to broader market patterns, Bitcoin’s weekly chart presents a concerning bearish divergence similar to the one seen during the 2021 market peak. This divergence, where the price reached new highs while the RSI declined, previously foreshadowed a 61% correction towards the 200-week EMA. Current indicators suggest a potential pullback toward $64,000, marking a steep 52% decline from recent highs.

Veteran trader Peter Brandt adds weight to this viewpoint, indicating that Bitcoin needs to reclaim its parabolic trendline to avoid a bearish cycle spiral. Should the cryptocurrency fail to reclaim this crucial trendline, a typical drawdown between 50% and 60% could emerge, marking the end of its current bullish phase.

Despite these warnings, some analysts remain optimistic. They draw parallels between Bitcoin’s market structures and gold’s explosive breakout in the 2000s, suggesting a potential bullish trajectory toward the $150,000 target. Analyst Tony Severino highlights a bull flag formation that may ignite substantial price movements, while Bitcoin researcher Axel Adler Jr. points to historical patterns suggesting an impending bullish impulse. A sustained break above the NUPL/MVRV ratio of 1.0 could signal the beginning of another major rally on par with those witnessed in previous years.

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