After hitting fresh record highs this month, bitcoin appears to be picking up on bearish pressure as a double top pattern can be seen on its 4-hour chart.
Will it break below the neckline soon?
Or will we see another attempt to climb?
Bitcoin (BTC/USD) 4-hour Chart by TradingView
Dollar strength over the past few weeks have dragged BTC/USD back down from its $124K all-time highs to the long-term support around $114K.
With that, price has completed a double top reversal pattern, although it has yet to break below the neckline to confirm that a downtrend is in the works.
Are we about to see a bounce or break from here?
Remember that directional biases and volatility conditions in market price are typically driven by fundamentals. If you haven’t yet done your fundie homework on the U.S. dollar and bitcoin, then it’s time to check out the economic calendar and stay updated on daily fundamental news!
Bitcoin bulls seem to be putting up a strong fight in terms of defending the floor, especially after Fed head Powell’s Jackson Hole Symposium testimony revealed a shift in favor of a more dovish bias.
Look out for a possible rebound to near-term resistance zones, including R1 ($117,136) near the moving averages then R2 ($120,875) and R3 ($124,127) at the record highs, in case the OG crypto is able to climb back above the pivot point level ($115,924).
On the other hand, keep your eyes peeled for a break below the $112K mark since this could clear the way for a drop to S1 ($110,225) then S2 ($106,973). Stay on your toes for sustained bearish momentum that could even drag bitcoin all the way down to the June lows near S4 ($99,576) and the $100K psychological barrier.
Whichever bias you end up trading, don’t forget to practice proper risk management and stay aware of top-tier catalysts that could influence overall market sentiment.
Disclaimer:
Please be aware that the technical analysis content provided herein is for informational and educational purposes only. It should not be construed as trading advice or a suggestion of any specific directional bias. Technical analysis is just one aspect of a comprehensive trading strategy. The technical setups discussed are intended to highlight potential areas of interest that other traders may be observing. Ultimately, all trading decisions, risk management strategies, and their resulting outcomes are the sole responsibility of each individual trader. Please trade responsibly.
