Bitcoin Breaks All-Time Highs, But a Pullback May Be Looming
2024-11-11

Alright, folks, I hate to break the bad news, but it looks like the rally may be over. If you look at the weekly chart, Bitcoin's massive Cup and Handle pattern pushed it effortlessly past its target of $75,021.83, setting new all-time highs. The price has surged above the key yellow trendline, a level where Bitcoin has historically faced significant resistance and has been rejected multiple times.

However, we do not expect this candle to close above the trendline. Instead, we’re anticipating a pullback, with Bitcoin possibly dropping to around $48,072.11. Here’s why In the past, Bitcoin has consistently struggled with this resistance level. Even when price action spiked above it, the candles failed to close above, consistently dropping back below. This historical pattern suggests the current breakout may not hold, and a rejection followed by a decline is likely.

The recent rally happened quickly because once Bitcoin broke through its resistance, it triggered a surge in buying momentum. This is common in markets when key levels are breached, it often leads to a rush of bullish activity as traders and investors pile in, driving prices higher. However, such rapid moves can be unsustainable if there's no fundamental support or if the resistance levels prove too strong to maintain.

The rally in Bitcoin could also be partly attributed to broader market optimism, often driven by political events. When markets are buoyant, Bitcoin seen as both a hedge and a speculative asset benefits from increased risk appetite among investors.