Last Updated on August 21, 2023 by Bitfinsider
Twice this year, the price of bitcoin failed to reach the $30k mark. Investors might be concerned since it may have created a double top pattern after rising from $16k.
The newest warning sign appeared last week. The price dropped following news that Elon Musk’s SpaceX sold out all of its Bitcoin holdings. More specifically, SpaceX sold $373 million worth of bitcoin.
One of the largest daily liquidations in terms of volume had ever occurred. On larger outflows than during the FTX collapse, the price of Bitcoin fell by more than 7% in just 20 minutes.
After Tesla sold its Bitcoin holdings last year, SpaceX also did likewise. More specifically, 75% of Tesla’s Bitcoin holdings were sold last year.
Bitcoin’s price has increased by twofold since the year’s beginning. Since the gain was so strong, it incited a surge of excitement among bitcoin investors. However, the inability to maintain above $30k resulted in the potential creation of a double top pattern.
A double top is a reversal pattern with a measured move that is projected from the neckline and equal to the distance from the top to the neckline. The neckline at the $25k area and the two tops produced in the $30k area are depicted in the chart above.
As a result, the measured movement is $5k, and extrapolating from the neckline, it is possible that Bitcoin will reach $20k sooner rather than later.
The double top area, or $30k, must be broken for the bulls to regain control of the market. The bias is now negative, though, and attention is being paid to a probable bearish breakthrough below the neckline.
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