The Bitcoin price bounced back recently, surging from a low of $76,485 to a high of $89,240. This recovery has led some analysts to predict that the bull run has started. However, while BTC’s price will likely rebound in the long term, technical analysis suggests it may crash soon.
Bitcoin Price Prediction: Technical Analysis
The current Bitcoin price rebound is likely part of a bear trap or a dead cat bounce. This is because the rebound has been relatively gradual, forming a rising wedge pattern. Wedges are popular reversal patterns known for their high degree of accuracy. Therefore, as the wedge approaches confluence, it will likely resume its downtrend.
Additionally, the ongoing BTC price rebound is part of a break-and-retest pattern. This occurs when an asset experiences a bearish or bullish breakout above a key level and then returns to its initial movement. In Bitcoin’s case, it has completed the formation of retesting the neckline of the double-top pattern at $108,300. Notably, the wedge’s confluence is occurring at the neckline of the double-top.
Moreover, Bitcoin remains below the 200-day and 50-day Weighted Moving Averages (WMA), indicating bears are in control. These two averages have formed a bearish crossover known as a death cross, which is often a highly bearish pattern.
Bitcoin price chart | Source: TradingView
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What BTC Price Needs to Reach All-Time High
Bitcoin will likely rebound and reach its all-time high later this year. For this to happen, it will need some fundamental and technical catalysts.
Technically, it needs to surpass $95,000, followed by $100,000. Such a move will likely trigger the Fear of Missing Out (FOMO) among retail and institutional investors. A break above the all-time high of $109,400 could lead to additional gains, possibly reaching $110,000, then $120,000.
Fundamentally, a stock market rebound, which some analysts expect soon, is necessary. In a note, an Evercore ISI analyst said:
“We think the two steps backward portion we lived through is in the process of resolving itself, and you’re likely to get three steps forward toward higher prices.”
A strong equity market benefits Bitcoin due to its correlation. Additionally, a retreat in the US dollar index and bond yields would suggest further Federal Reserve cuts.
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