Bitcoin (BTC) price has been falling for the past few weeks. It is now at risk of falling below a short-term bearish pattern.
The collapse of this pattern may be the reason for the sharp drop in BTC price, bringing it to its lowest level since early March.
BTC's price action since the beginning of April has been bearish. This was highlighted by a bearish engulfing candlestick pattern for the week of April 17-24, and was rejected twice in the following weeks (red icon).
This move confirms the $29,800 area as resistance on the weekly time frame. So it could peak locally. Despite the bearishness, the weekly Relative Strength Index (RSI) shows that the long-term trend is still bullish, as it is above 50 and rising.
BTC/USDT weekly chart:
Technical analysis of the daily timeframe shows a bearish bitcoin price forecast. This is due to the formation of a favorable head and shoulders pattern, which is usually considered as a bearish pattern.
The pattern consists of the highest peak created between the other two peaks. After that, the neckline breakout will catalyze a sharp decline.
The breakdown of the pattern (white) at its full height could bring the BTC price down to as low as $23,400. This level overlaps with the 0.5 Fibonacci retracement support (black).
According to the Fibonacci principle, after a significant change in price in one direction, it usually partially retraces or returns to the previous price level before continuing in the original direction.
BTC/USDT daily chart:
Despite this bearish forecast, a price move to $30,000 above the top of the right shoulder (red line) would indicate that the trend is not bearish. Instead, it could lead to an increase in the next long-term resistance level of $36,500.
The collapse of this pattern may be the reason for the sharp drop in BTC price, bringing it to its lowest level since early March.
BTC's price action since the beginning of April has been bearish. This was highlighted by a bearish engulfing candlestick pattern for the week of April 17-24, and was rejected twice in the following weeks (red icon).
This move confirms the $29,800 area as resistance on the weekly time frame. So it could peak locally. Despite the bearishness, the weekly Relative Strength Index (RSI) shows that the long-term trend is still bullish, as it is above 50 and rising.
BTC/USDT weekly chart:
Technical analysis of the daily timeframe shows a bearish bitcoin price forecast. This is due to the formation of a favorable head and shoulders pattern, which is usually considered as a bearish pattern.
The pattern consists of the highest peak created between the other two peaks. After that, the neckline breakout will catalyze a sharp decline.
The breakdown of the pattern (white) at its full height could bring the BTC price down to as low as $23,400. This level overlaps with the 0.5 Fibonacci retracement support (black).
According to the Fibonacci principle, after a significant change in price in one direction, it usually partially retraces or returns to the previous price level before continuing in the original direction.
BTC/USDT daily chart:
Despite this bearish forecast, a price move to $30,000 above the top of the right shoulder (red line) would indicate that the trend is not bearish. Instead, it could lead to an increase in the next long-term resistance level of $36,500.