Bitcoin Price Analysis

Bitcoin’s (BTC) recovery appears to have lost momentum due to the emergence of a double top bearish reversal pattern on short-term price charts.

BTC reached a peak of nearly $87,400 last week, followed by a pullback to around $84,000 on Friday, and then a recovery attempt above $87,000 before stalling again. This formation of two prominent peaks at similar levels, separated by a trough, suggests a classic double top pattern, which typically indicates the end of an uptrend.

Double Top Confirmation

For the double top to be confirmed, there needs to be a decisive drop below the “neckline”, the support level between the two peaks, located around $86,000. If this dip occurs, BTC may decline toward $75,000 or lower in the short term. Nevertheless, long-term charts indicate that the asset continues to remain in an ascending range.

Market Reactions

Traders displayed optimism following the U.S. Federal Reserve’s dovish position on inflation and alleviated concerns regarding upcoming U.S. tariffs, which have contributed to gains over the last week. However, diminished correlation between altcoin performance and BTC’s recent movements suggests that current price actions may lack widespread market support, raising the risk of a “fakeout” rally.

Potential Impact on Altcoins

A decline in BTC is likely to affect major tokens, potentially undermining recent gains and hopes for a sustained rally. For instance, Dogecoin (DOGE), which is heavily influenced by market sentiment and speculative trading, could experience magnified losses if Bitcoin’s bearish pattern materializes. Similarly, XRP may see reduced momentum due to its sensitivity to market sentiment and regulatory factors.

Solana might also be particularly vulnerable due to its recent volatility and technical signals; it has approached a potential “death cross” (a bearish signal where the 50-day moving average crosses below the 200-day moving average), which historically leads to more significant losses.

Critical Zone for Bitcoin

Currently, Bitcoin hovers in a crucial zone. A weekly close below $84,000 could confirm the bearish double top formation, while a push above $87,500 might invalidate it, potentially reigniting bullish momentum.