Veteran trader Peter Brandt recently highlighted an intriguing pattern now building on the Bitcoin chart, generating interest and discussion among traders and investors.
Veteran trader Peter Brandt recently highlighted an intriguing pattern now building on the Bitcoin chart, generating interest and discussion among traders and investors.
Brandt tweeted A screenshot of the four-hour Bitcoin price chart, indicating an ascending trend line and what appears to be a gradually emerging head and shoulders pattern.
Brandt The post caught the attention of an X user, who asked if it was a “head and shoulders” formation, to which Brandt responded: “Starting to take shape that way.”
The head and shoulders pattern is a well-known technical indicator that predicts a trend reversal. It is distinguished by three peaks, the middle peak (the head) is the tallest and the two outer peaks (the shoulders) are lower and approximately equal in height. When this pattern follows an upward trend, it is generally considered a bearish reversal indicator.
Validation of such a pattern could suggest that Bitcoin could be on the verge of a price correction following its recent bull run. This could potentially offer a strategic entry point for investors looking to buy at lower prices.
As the crypto community watches the price of Bitcoin with bated breath, the precise implications of the identified pattern remain subject to interpretation. It remains to be seen whether it will lead to a bearish reversal or defy expectations.
Options indicate Bitcoin traders could be preparing for a price reversal
Bitcoin has fallen around 13% from its current all-time high of $73,750, marking one of the most significant drops this year.
At the time of writing, Bitcoin was down 1.71% over the past 24 hours to $64,318 and down 6.68% over the week. Bitcoin’s pullback contrasts with this week’s stock market rally, in which traders are more optimistic that the Federal Reserve will lower interest rates this year.
Options indicate that traders are prepared for a prolonged decline in Bitcoin as demand for US exchange-traded funds with exposure to the cryptocurrency begins to fade.
Bitcoin put options expiring on March 29 have outperformed calls in volume, pushing up the put-to-call ratio, a crucial indication of market sentiment, signifying a bearish view on the short. term, according Bloomberg, citing data from Deribit. The put option strike prices range between $50,000 and $45,000, which is lower than Bitcoin’s current price of approximately $64,000.
