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BTC could see the same scenario of 2021 collapse
A well-respected analyst has expressed concerns about Bitcoin (BTC) and believes it may be forming a bearish pattern that has previously led to a collapse in late 2021.
The analyst, who goes by the name Rekt Capital, has shared with his 350,800 followers on X social media platform that Bitcoin is dangerously close to breaking down from a bearish double-top pattern.
Rekt Capital has suggested that if there is a sell-off event with increased volume, it could trigger the breakdown process.
He has warned that if Bitcoin validates its double top formation, it could confirm the breakdown, especially if there is a breakout on seller volume and a convincing loss of approximately $26,000 followed by turning it into new resistance.
Looking at the big picture, Rekt Capital suggests that Bitcoin is following a similar pattern to its late 2021 price movement. During that time, BTC concluded its previous bull market after breaking down from a double-top pattern.
In 2021, BTC formed two noticeable tops, which resembled a double top before eventually forming a third top at a lower high.
Currently, it seems that BTC has once again created two noticeable tops, similar to a double top, and there is a possibility that a third top may form at a lower high.
According to Rekt Capital, BTC’s price action is not the only similarity to 2021. The crypto strategist notes that key moving averages are now acting as resistance for BTC, just like in the past.
The bull market moving averages, the green 21-week EMA and the blue 50-week EMA, are located around $27,000-$28,000 and are currently impeding BTC’s progress.
The analyst predicts that Bitcoin may rebound once more before experiencing a significant corrective move near the $20,000 price range.
“The BTC 2021 fractal suggests BTC could soon form its third top at a lower high before rejecting there and finally losing ~$26,000 support.”
He continued and said:
“After that, the fractal suggests that BTC would bounce but only to turn ~$26,000 into new resistance before rejecting lower.”
