Bitcoin (BTC) is currently facing a number of factors that could lead to further price drops, with the head of research at Uphold identifying a possible bearish double top pattern.
Bitcoin has been leading the market on a bearish path, experiencing losses over the past few weeks. Despite historically performing well in July, BTC has already dropped by 3.71% this month, following a discouraging 7% decline in June.
As a result, Bitcoin is hovering around the lower end of the $60,000 range, with industry experts believing that the downturn may not be over. Dr. Martin Hiesboeck, Uphold’s Head of Research, has recently identified a double top pattern on the weekly timeframe, indicating a potential bearish trend.
A double top pattern occurs when an asset’s price reaches a high point twice, with a moderate decline in between. If the price subsequently falls below the level of the intervening low, it confirms the pattern and suggests further decline.
Bitcoin’s first top occurred when the asset reached an all-time high of $73,873 in mid-March, followed by a moderate drop, and then a second top when it rose to $72,000 in early June. Despite this, the pattern remained uncertain as BTC had not dropped to the neckline around $60,000.
However, amid recent price declines, Bitcoin has retested the region around the neckline, currently trading for $60,362. According to Dr. Hiesboeck, this makes the weekly double top pattern clearer, increasing the chances of steeper declines. He has advised investors to manage their risks appropriately.
There are several factors contributing to the expected declines, including sustained selloffs by whales and miners. Lookonchain recently highlighted a whale that has consistently moved millions in BTC to Binance, with one address transferring 1,023 BTC worth $62.2 million to the exchange in the last 24 hours.
Another factor is the increased deposits of Bitcoin on exchanges, which has led to an increase in the selling pressure and compounded the decline. Additionally, the German government has recently moved 400 BTC to Coinbase and Kraken, and Bitcoin has also decoupled from the bullish U.S. equities, retaining its bearish trend.
It is important to note that this content is informational and should not be considered financial advice. Readers are encouraged to conduct thorough research before making any investment decisions.