"W-shaped bottom is a trap"...Bitcoin could fall to $68,000 if it can't break 'here'

▲ Bitcoin (BTC)/AI generated image

Bitcoin (BTC) has shown the potential to enter a correction phase as selling pressure increases below a key technical zone. Analysis suggests that with major support levels threatened and reversal patterns forming, the market has reached an inflection point that will determine its future direction.

NewsBTC reported on May 23 (local time), citing cryptocurrency analyst Kamile Uray, that Bitcoin's buying momentum is weakening. Uray analyzed that if Bitcoin falls below the critical low of $74,929, the final shoulder in the developing head-and-shoulders structure could be completed. This structure is progressing below the previous low near $76,044.

Uray believes that if Bitcoin fails to make a clear close above $78,213 on the 4-hour chart, the bearish trend is likely to continue. A sustained break below $74,929 could open up further downside to the $71,000 to $68,000 range. This range was presented as a key Fibonacci support level.

Analysis also suggested that a recovery rally attempt is possible if strong buying pressure enters the lower range. Uray pointed out that in an upward reversal, Bitcoin must first overcome resistance near $98,000, and then break through a larger resistance zone between $107,000 and $109,000.

However, Uray emphasized that the risk of a major correction remains if Bitcoin fails to maintain strength above its recent high of $126,199. When a deeper decline unfolds, $60,000 could act as a crucial support level determining the long-term market direction.

Another cryptocurrency analyst, Merry__PT, diagnosed that Bitcoin's recent price action is undergoing a structural change. Merry observed that the W-shaped bottom structure, previously considered a bullish reversal signal, is now transforming into a head-and-shoulders top structure, which is interpreted as a bearish reversal signal.

Merry presented the blue horizontal base neckline as the most important technical element going forward. This support zone serves as the foundation for the current structure and the potential for a larger trend reversal. The explanation is that if this neckline is clearly defined and widely recognized by market participants, the validity of the head-and-shoulders pattern could increase.

If Bitcoin clearly breaks below this neckline, the pattern, which was merely a technical observation, could turn into a signal triggering a sustained correction. The monthly close was also mentioned as a key criterion for judging future investor sentiment and market direction.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*