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Bitcoin price bounced back and moved above the key resistance level of $84,000 after tumbling to a multi-month low of $78,200 on Friday.
Bitcoin’s (BTC) rebound coincided with a recovery in U.S. equities, which pared back earlier losses. The Dow Jones index rose 165 points, while the Nasdaq 100 gained 80 points.
A potential catalyst for the recovery was news that BlackRock maintained its bullish stance on Bitcoin this week. The world’s largest asset manager confirmed plans to allocate about 2% of its model portfolio assets to its IBIT ETF.
Bitcoin also rebounded following the release of an encouraging personal consumption expenditure report in the United States. Core PCE, which the Federal Reserve closely monitors, rose 0.3% from December and 2.6% year over year, marking its smallest increase since 2021.
Federal Reserve officials hope inflation will continue trending toward the 2% target, which would support further interest rate cuts. However, this could be complicated by Donald Trump’s recent indication that new tariffs may take effect in March.
Market analysts remain split on Bitcoin’s next price action. In an interview with crypto.news, Aurelie Barthere, principal research analyst at Nansen, predicted that Bitcoin will enter a consolidation phase following the recent crash. She explained:
“We just had 4 large daily red candles on high volume after weeks of range-bound price action for BTC. After this type of “panic” selling, there needs to be a period of price consolidation with higher lows to confirm we resume higher (buyers slowly regaining confidence after having been burnt).”
On the other hand, Mark Cudmore, a Bloomberg analyst, warned of further downside, suggesting Bitcoin could enter a prolonged crypto winter. He said:
“The real panic may be ahead of us still. Bitcoin always has another 70%+ crash in its future, by construction. $72k-$74k would appear to be the technical crunch zone that might trigger the next crypto winter.“
Bitcoin price analysis
Bitcoin formed a double-top pattern at $108,532, with its neckline positioned at $89,000. The distance between the double-top and the neckline was 18%.
Applying the same distance from the neckline sets Bitcoin’s target at approximately $72,850, aligning with its highest level from March 2023. A drop to this level could be a bullish signal, marking the completion of the break-and-retest chart pattern.
This article first appeared at crypto.news
