Renowned trader and analyst Peter Brandt have issued a warning to Bitcoin (BTC) investors about a potential trend reversal. Brandt highlighted a head and shoulders pattern on the daily chart of BTC, urging traders not to disregard its confirmation. Read his latest analysis.
Bitcoin’s Upsurge and Potential Trend Reversal
So what is this ominous-sounding H&S pattern, you ask? Well, it’s a technical formation that often indicates a shift from a bullish trend to a bearish one. The pattern consists of three peaks, with the middle peak forming the “head” and the other two peaks forming the “shoulders.” These peaks are typically of decreasing height. The pattern is confirmed when the price breaks below the neckline, connecting the lows of the shoulders.
Brandt shared a chart illustrating the head and shoulders pattern in a recent tweet. According to the chart, the left shoulder was formed when BTC broke out from $20,000 in February and reached a range of $26,000 to $28,000 in March. The head was formed in April when BTC hit a high of $31,000. The right shoulder came into existence as BTC recovered from a dip between April 19 and 24.
End of BTC Bull Run?
But wait, there’s more! Bitcoin has been on an upward trend since the start of the year, reaching its peak in mid-April. Despite experiencing some corrections since then, it has still gained 65% this year. So, if the H&S pattern proves to be true, it could spell the end of the rally.
However, before you start panicking, it’s important to note that not all H&S patterns result in accurate predictions. False breakouts and whipsaws can occur, so additional confirmations are needed for informed trading decisions. At present, BTC is trading at $27,384, experiencing a 1% decline in the last 24 hours and a 5.92% decrease over the past week.
In conclusion, while the head and shoulders pattern is cause for concern, it’s not necessarily a death sentence for Bitcoin. Traders and investors must stay vigilant and keep a close eye on Bitcoin’s price action to make informed decisions. Whether the cryptocurrency continues its upward trajectory or experiences a trend reversal, one thing is for sure: the Bitcoin market is never dull.
Source: https://coinpedia.org/bitcoin/is-bitcoins-bull-run-over-analyst-peter-brandt-warns-of-trend-reversal/