Bitcoin prices have fluctuated considerably over the past two months, creating a bearish pattern that has sparked concern among investors. Following a sharp rise, Bitcoin has recently encountered resistance, suggesting that further losses may be ahead.
Market sentiment is cautious as Bitcoin struggles to break through key levels. Additionally, a potential decline to $92,000 has been widely debated.
Bitcoin is being bought
Bitcoin’s Network Value (NVT) ratio is currently at the highest level in a year, indicating that the network rating is well above transaction activity. Historically, such a surge in NVT ratios has often served as a precursor to market revisions.
This suggests that Bitcoin may be overvalued, leading to a potential cooldown in price. A slight decline in the NVT ratio was observed this past weekend, but this was primarily due to external factors and did not change the broader trend.
Bitcoin remains vulnerable as an acquired asset, and historical patterns indicate that after such accumulation, corrections are often inevitable.
Additionally, the Bitcoin liquidation map shows that if Bitcoin prices fall to $92,000, a long liquidation of over $1.17 billion could occur. This potential liquidation spike suggests a significant risk for those who hold long positions.
Despite the positive funding rates that have driven some quarterly optimism, the liquidation map shows that if Bitcoin reaches $92,000, Bitcoin could face considerable downward pressure. This suggests that the bearish trend is not over yet and that Bitcoin could struggle to maintain prices above its main support levels.
BTC prices are vulnerable to losses
Bitcoin now forms a double-top pattern, also known as the inverse W pattern. This pattern is usually considered a bear signal, suggesting that Bitcoin could face a fix if verified. The formation of this pattern over the past two months has highlighted an increase in sales pressure, which could lead to further declines in prices.
Currently, this pattern is over $100,000, but below this important level, you’ll see a bearish setup. If Bitcoin’s price falls below $98,000, you could potentially target a crash up to $92,000, representing a 9% drop. This will further sell and strengthen Bitcoin’s bearish outlook in the short term.
However, if the broader market situation improves and Bitcoin succeeds in exceeding the $100,000 support level, it could potentially rebound. The recovery, watching Bitcoin flip over $102,734 to support, changes momentum towards the bullish side. This will drive Bitcoin prices up to $105,000, potentially invalidating the current bearish paper.
Disclaimer
In line with Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. Although Beincrypto is committed to accurate and unbiased reporting, market conditions are subject to change without notice. Always carry out your research and consult with an expert before making any financial decisions. Please note that our terms and conditions, privacy policy and disclaimer have been updated.
