Bitcoin Price has once again captured the attention of veteran trader Peter Brandt, who remains cautious about its future trajectory. In his recent analysis, Brandt shared a chart that suggests a bearish outlook for the leading cryptocurrency. The chart highlights a well-known technical formation called the “broadening top pattern,” which is often a precursor to a trend reversal.
Brandt’s observation comes as Bitcoin experienced a rally that many hoped would signal a sustained upward trend. However, the seasoned trader expressed skepticism, stating, “This week’s rally may be all the retesting of the broadening top we will see. Of course, we will see.”
Bitcoin Price Set for a Decline?
According to Brandt, Bitcoin Price failed to reach the upper boundary of its long-term price channel during the recent market advance. Historically, such behavior has often signaled a subsequent drop towards the channel’s lower boundary. This critical area lies below $70,000 and extends into the mid-$45,000s, which Brandt considers a feasible target rather than a worst-case scenario.
Brandt estimates a 30% chance that Bitcoin has already reached its peak in the current cycle. If this top occurs in the second half of September, it might be termed the “Brandt Top,” he suggested. At the time of his analysis, Bitcoin was trading around $120,000.
Analyzing the Dead Cat Bounce
In November, Brandt revisited his chart, illustrating a “dead cat bounce” scenario. This term describes a brief recovery in the midst of a broader bearish trend. Bitcoin’s recent two-week decline from over $120,000 to the low $80,000s fits this pattern, representing a complete five-wave correction with just a modest rebound.
The chart indicates that traders have been confined to a narrow range of $88,000 to $92,000, which Brandt identifies as the most critical zone at present. This range’s behavior will likely dictate the market’s direction moving forward.
Will Bitcoin Price Rebound in 2025?
As December began, Bitcoin traded near $85,000, but soon rebounded sharply to the $94,000 area. This movement has reignited hopes for a potential Christmas rally. Retail investors are particularly focused on the $97,000 mark, a significant resistance level and a potential profit-taking point. Yet, the market has yet to breach this target.
Despite recent volatility, Bitcoin continues to influence the broader crypto market, with major altcoins often mirroring its movements. Market sentiment generally shifts in tandem with Bitcoin’s price changes. Presently, traders remain cautious but hopeful for a decisive breakout to set the tone for 2025.
On a positive note, the past two months’ “extreme fear” sentiment is beginning to ease as the Fear & Greed Index transitions from red to orange, suggesting a potential shift in market outlook.
