- Bitcoin’s price forms a head-and-shoulders pattern, signaling potential weakness and a possible correction ahead.
- Peter Brandt outlines three possible scenarios, including a drop to $76,000 or a bear trap leading to a rally.
The new year has begun with uncertainty for Bitcoin, as its price action forms a head-and-shoulders pattern, a well-known technical indicator that often precedes market downturns.
After nearly breaking a new all-time high, Bitcoin failed to sustain momentum, leading analysts to question whether the current market structure signals an impending correction.
The head-and-shoulders formation consists of three peaks, with the middle peak being the highest, representing the head, and the two side peaks (shoulders) failing to surpass it. If the pattern is confirmed, it could indicate a weakening bullish trend, potentially sending Bitcoin into a deeper pullback.
Peter Brandt’s Three Possible Bitcoin Scenarios
Veteran trader Peter Brandt, known for his decades of experience in market analysis, has identified three possible outcomes for Bitcoin based on its current price structure:
- A full breakdown of the head-and-shoulders pattern, which could push Bitcoin toward the $76,000 level, a decline of over 18% from its current price.
- A bear trap scenario, where Bitcoin experiences a temporary breakdown, triggering bearish sentiment, only to reverse sharply in a short squeeze rally.
- An extended pattern formation, which may evolve into a larger structure, though its bullish or bearish implications remain uncertain.
Market Sentiment Divided as Bitcoin’s Next Move Remains Unclear
While chart patterns offer historical insights, Brandt emphasizes that technical formations are not absolute—they can change or fail altogether. Bitcoin’s price action remains volatile, with macro conditions, liquidity flows, and institutional behavior playing a significant role in shaping its trajectory in early 2025.
This is a classic H&S top pattern. $BTC H&S patterns can do one of 3 things:
-Complete and trend to target
-Fail with bear trap
-Morph into larger pattern
What do you think?
I am only allowing Verified to reply. If you cannot pay a few bucks to X you don't deserve to be heard. pic.twitter.com/9dGquEXaUs— Peter Brandt (@PeterLBrandt) January 12, 2025
Despite the uncertainty, Bitcoin’s long-term fundamentals remain strong, and the coming weeks will be crucial in determining whether the market confirms a bearish structure or invalidates the head-and-shoulders formation with renewed upside momentum.
Bitcoin (BTC) is currently trading at $91,342.06, reflecting a 3.91% decrease in the last 24 hours. Its market capitalization stands at $1.81 trillion, with a 24-hour trading volume of $35.7 billion, marking a 97.74% increase. The circulating supply is 19.8 million BTC, with a fixed maximum supply of 21 million BTC.
According to ETHNews, Bitcoin continues to attract strong institutional demand, with BlackRock’s IBIT acquiring 4,868 BTC, surpassing the weekly mining supply, which underscores the growing scarcity and accumulation by major financial entities.
Additionally, several U.S. states are exploring Bitcoin reserves, positioning BTC as a strategic financial asset for economic diversification.