As per a crypto analyst, ‘TradingShot,’ Bitcoin has established a Double Bottom pattern and is poised to soar to a new All-Time High (ATH) of $112,000. This potential uptick followed a significant price drop pushing the cryptocurrency below the $100,000 threshold.
Bitcoin Price Resilient With Double Bottom Support
The price of Bitcoin plummeted below $100,000 recently due to the rise in popularity of the China-based Artificial Intelligence (AI) model called DeepSeek, overshadowing OpenAIโs ChatGPT in the US and global investment markets. Despite this sudden decline triggering a massive sell-off, Bitcoin managed to recover over 50% of its losses promptly.
After the sharp selloff, TradingShot indicated that Bitcoin found support at a Double bottom level, utilizing two robust support lines to prevent further downtrends. The analyst displayed a comprehensive price chart illustrating various Double Bottom formations, with one emerging near the 4-hour 200-Moving Average (4H MA200).
A Double Bottom pattern signifies a possible reversal from a downtrend to an uptrend, characterized by two consecutive lows around the same price level resulting in a W-shaped movement.
Examining the chart, Bitcoin’s price is within an Ascending Channel, indicating an overall uptrend. The 4H MA200 on the orange trend line acts as a robust Double Bottom support level, recently tested by Bitcoin for the first time in 12 days.
TradingShot also highlighted a “Pivot trend line” that previously posed resistance to Bitcoin since its ATH on December 17, 2024, now serving as a support line with the price reversal near it. Bitcoin almost touched the bottom of January’s Channel Up, suggesting a significant support zone akin to December, where the cryptocurrency bounced off the same support to achieve a new ATH.
Significant Resistance at 4H MA50 – Breakout or Rejection?
In TradingShot’s analysis, the 4H MA50 is viewed as a dynamic resistance level for Bitcoin marked by the blue line. Currently trading below this Moving Average, a breakout above this level could catalyze further upward movement.
The analyst predicts that breaching the 4H MA50 could drive Bitcoin’s bullish momentum towards a higher range of $110,000 to $112,000, setting a new ATH for the pioneer cryptocurrency that has previously surpassed $108,000.
Backed by Bitcoin’s Relative Strength Index (RSI), the analyst identifies oversold areas marked in green circles on the chart. Historically, when RSI dips below 30, Bitcoin tends to rebound strongly, indicating potential for a significant bounce.
Nevertheless, a bearish scenario is anticipated if Bitcoin faces rejection near the 4H MA50, potentially revisiting the Double Bottom at $98,000, a level observed on December 23 and January 13. Further downside is expected if the cryptocurrency continues on a downtrend, with the analyst foreseeing a drop to $96,000.
