Market analyst Peter Brandt has warned that the price of bitcoin (BTC) is going through a moment of technical weakness and is currently “preparing to give a sell signal.”
According to the specialist, bitcoin’s recent behavior suggests that the bullish momentum could be running out, which opens the door to a significant correction in the short term as the asset moves away from the $70,000 mark.
This forecast is triggered by the identification of a specific formation in the price charts. Brandt explained that the signal is seen through technical analysis where detected the formation of “a rising wedge pattern”.
A rising wedge is a chart pattern that, despite showing an upward tilt, is generally interpreted as a bearish reversal pattern. This means that, after a period of increases, the price usually breaks down.
This figure is formed when the price of BTC (or another financial asset) oscillates between two trend lines converging upward. The resistance line, which is the ceiling that the price fails to overcome, connects a series of higher and higher highs. In the current case, these highs that Brandt identifies are those located at 72,271, 74,050, and 71,777 dollars. On the other hand, the support line, which functions as the floor that supports the falls, joins the ascending lows of ($60,000, $62,510 and $65,618).
The key to this pattern is that the slope of the support line is steeper than the resistance line. This indicates that, Although lows rise quickly, buyers are finding it increasingly difficult to push the price to new highs.
Currently, the price is pressing the lower trend line and a clear break below this level, especially with a daily close, would confirm the aforementioned sell signal. If this happens, the theoretical downside target is close to the psychological level of $60,000 that has already served as support for bitcoin during the February 6 crash.
Brandt’s voice joins that of analyst Willy Woo, who believes that the bitcoin market is still approximately a third away from completing its bearish cycle and anticipates an extension of crypto winteras reported by CriptoNoticias.
On the opposite side, Michaël van de Poppe argues that the bear market could have bottomed, as the recent correction remains within typical historical ranges of market bottoms, and suggests that bitcoin would be going through a phase of lateral consolidation as a preliminary step to a new upward trend.
For its part, the on-chain firm Glassnode adopts a more balanced stance, describing the current price structure as “more constructive than openly bullish”, without identifying signals as negative as those of Brandt and Woo, but without launching immediate bullish projections either.