Classic technical indicators predict that the price of Bitcoin will fall sharply again, with a target of $16,000

Bitcoin (Bitcoin) During the May 19 crash, it bottomed out and rebounded to $30,000 and then rebounded more than 25%. However, due to the classic technical indicator model, cryptocurrencies may face another period of strong selling.

Bitcoin price in the “bearish pennant”

is called Bearish pennantThis pattern is formed when assets are consolidated after a strong downward movement and form a small symmetrical triangle price range. It broke the range support and continued to move lower. Traders usually estimate the size of a negative breakout move by measuring the height of the previous move.

Bitcoin is currently trading within a similar bearish pennant structure, oscillating sideways when forming a series of lower highs and higher lows. At the same time, its integration structure fell sharply to around US$20,000. Therefore, if the BTC/USD exchange rate falls below the pennant structure, with the increase in trading volume, it is highly likely that it will plummet to nearly 20,000 US dollars.

The bearish outlook also draws on clues from Bitcoin’s recent rebound.It’s worth noting that the cost of buying a bitcoin From nearly 65,000 USD to 30,000 USD May 19-or more than 50%-followed by A respectable 30% rebound.

Bitcoin pennant structure and its main downside targets. Source: TradingView

At the same time, the market analysis service Income Machine warned that “Dead cat bouncing“The scenario in the Bitcoin market pointed out that the upcoming BTC/USD rally may be limited by further selling pressure near the May 26 high (39,000-41,000 USD area). It recommends that traders withdraw from close to 40,000 USD Bullish position.

More importantly, the income machine is also famous Failure to hold $30,000 as support could cause the price of Bitcoin to plummet to $16,200-a level that is consistent with the bearish pennant target. The analyst firm chose $16,200 because of its historical relevance as support during the November-December 2020 meeting.

Bitcoin’s bearish outlook proposed by Income Machine. Source: TradingView

“On the contrary, if we break the high of May 26 upwards, we will reverse our analysis and adopt a more optimistic outlook for BTC-USD,” the Income Machine analyst added.

Pankaj Balani, CEO and co-founder of the crypto derivatives exchange Delta, also predicts that if the price of Bitcoin closes below $34,000, there will be a long-term bearish decline. Nevertheless, the former UBS alumni limited his downside target to $28,000, which is the lowest level for 2021. He told Cointelegraph:

“Before taking any decisive action, traders will pay close attention to these levels. That is to say, compared with a bear market, the risk for bulls is still higher because the long-term price trend is in the downward direction.”

Bullish outlook

Balani also pointed out that current price trends indicate that demand is between US$30,000-35,000. Therefore, an upward swing from this zone may eventually break the bearish pennant-which Barani calls a symmetrical triangle-upwards.

“BTC is forming a classic symmetrical triangle, and any breakout/collapse will cause the price to fluctuate sharply,” he said, adding:

“If BTC eventually exceeds $40,000, it is expected to rise to $45,000.”