Bitcoin’s recent performance is under scrutiny, with market observer Tony Severino expressing reservations about its behavior on the weekly chart. The leading cryptocurrency is currently valued below $110,000, fueling speculation that it could descend below the crucial $100,000 threshold.
Bearish Signals Emerge for Bitcoin on Weekly Timeframe
In a post on X, Severino highlighted the potential formation of an Evening Star pattern on Bitcoin’s weekly chart, a development that has captured his attention. He emphasized that this pattern is materializing near the Bollinger Band’s middle line, around $111,600, amidst the most constricted Bollinger Band squeeze in Bitcoin’s history.
Previously, Severino pointed out that Bitcoin’s weekly Bollinger Bands have reached their narrowest configuration ever recorded in the BTCUSD market. Essentially, Bitcoin is currently trading within a limited range, indicating a period of diminished volatility. Severino’s accompanying visualization illustrates that the upper Bollinger Band sits near $122,000, the middle band at $111,600, and the lower band at $101,000.
The Evening Star formation typically suggests a shift in power from buyers to sellers, potentially exposing Bitcoin to further downward pressure. Given the compressed state of the Bollinger Bands, Severino is likely concerned about the possibility of Bitcoin declining towards the lower Bollinger Band boundary. Crypto analyst Bob Loukas has corroborated the bearish sentiment, suggesting that Bitcoin could potentially fall below $100,000.
Loukas observed that Bitcoin appears to be approaching its Weekly Cycle Low, while also acknowledging Bitcoin’s relative strength despite the prevailing negative trend. Loukas stated that a rally to $118,000 would be confirmation of the start of a new cycle.
Until a confirmed rally, sellers are in control. Loukas’ chart indicates the cryptocurrency may drop below the $100,000 mark. However, he maintains a longer-term bullish outlook, anticipating a potential rally to $140,000 in the future.
Bitcoin’s Key Recovery Level: $116,300
Analyst Ali Martinez also cautioned that Bitcoin must regain the $116,300 level to avoid a potential decline to $94,334, based on Pricing Bands analysis. He had earlier identified $107,200 as a critical support level for Bitcoin. Martinez believes that breaching this support could lead to a test of $100,000 or even $93,000.
Meanwhile, Titan of Crypto observed that Bitcoin has fallen below the $110,000 trendline. He emphasized the need for further confirmation, stating that the lagging span must follow to validate this bearish move. However, Titan of Crypto remains unconvinced that Bitcoin has reached its peak, suggesting that the current market fear is not indicative of a cycle top.
As of this report, Bitcoin is trading around $109,600, reflecting an increase over the past 24 hours, according to CoinMarketCap data.