Bitcoin prices have entered a correction phase after falling 14% from their all-time high this year, a trend that could continue as risky patterns form and exchange-traded fund (ETF) outflows continue.
summary
- Bitcoin price is forming a double top pattern on the daily chart.
- The Spot Bitcoin ETF shed more than $1.6 billion in assets this week.
- Investors are very concerned following recent liquidations.
US investors sold off their Bitcoin (BTC) holdings this week as the crypto fear and greed index plummeted into the fear zone and liquidations surged.
The Spot Bitcoin ETF shed more than $1.23 billion in assets this week, according to data compiled by SoSoValue. BlackRock’s IBIT lost more than $268 million, Fidelity’s FBTC suffered losses
These outflows bring the total inflows since its inception in January last year to $61.54 billion.
The outflows mark a sharp reversal from the past two weeks, when assets rose by about $6 billion over the past two weeks.
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Investors dumped Bitcoin last Friday as the cryptocurrency market crashed, after the cryptocurrency suffered more than $4.65 billion in liquidations. After such a large liquidation event, it is common for investors to sell their coins or remain on the sidelines.
Bitcoin liquidations reached $4.65 billion last week | Source: Coinglass
It also sold off Bitcoin as gold emerged as a safer asset amid rising risks. The U.S.-China trade war could escalate, leading to higher inflation and preventing the Fed from cutting interest rates.
Other notable risks include the ongoing U.S. government shutdown and credit quality. Credit issues came to light after three local banks reported fraud-related losses.
Technical analysis of Bitcoin price
BTC price chart |Source: crypto.news
The daily timeframe chart shows that BTC price remains under pressure after falling 14% from this year’s high.
It crashed below the 50-day moving average and the supertrend indicator turned red. Most notably, the coin has formed a double top pattern at $124,355.
A double top is one of the most common bearish signs in technical analysis. Its profit target is estimated by measuring the distance between the head and neckline and then the same distance from the neckline.
In this case, the profit target would be about $92,345, the lowest level since April of this year. The bearish outlook will be invalidated above the $113,000 resistance.
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