Bitcoin Price Teeters at $105K: Head and Shoulders Signals Potential Crash to $90K

Bitcoin Price Teeters at $105K: Head and Shoulders Pattern Signals Potential Crash Below $100K

Bitcoin hovers near $105,000 amid mounting selling pressure. Analysts warn of a bearish Head and Shoulders pattern that could drive BTC toward $90,000 or even $80,000 if key supports fail.

Bitcoin remains locked in a tense battle around the $110,000 psychological barrier as relentless selling pressure erodes bullish momentum. After touching a fresh all-time high above $126,000 just weeks ago, the flagship cryptocurrency now faces growing predictions of a sharp correction. Prominent technical patterns and historical precedents paint a cautionary picture for investors eyeing the next major move.

Bearish Head and Shoulders Takes Shape on BTC Charts

Crypto analyst Toby Dawson recently highlighted a classic Head and Shoulders (H&S) formation on the daily timeframe, a setup often preceding significant downside. The pattern began forming in September when Bitcoin carved out its left shoulder near $117,000 during a period of intense consolidation.

A subsequent rally pushed the price to its head at the record peak above $126,000, only to encounter stiff resistance. Sellers stepped in aggressively, initiating the ongoing pullback. The right shoulder materialized during late-October’s brief surge back to $117,000, completing the structure.

Key measurements from the pattern suggest a measured move targeting approximately $90,000 upon a confirmed neckline break. The neckline currently aligns with the critical $100,000 support zone, making any close below this level a potential trigger for accelerated liquidation.

Historical Peaks Often Precede Deep Corrections

Supporting Dawson’s bearish thesis, another market watcher points to Bitcoin’s post-ATH behavior. Since 2017, every major cycle top has been followed by drawdowns exceeding 30% within months. The current setup mirrors those prior instances, with overextended momentum indicators flashing warning signs.

The 1-week 50-period Exponential Moving Average (EMA)—currently sitting near $105,000—serves as immediate dynamic support. A weekly close beneath this metric, combined with a breach of $100,000, could open the floodgates toward $80,000 or lower, according to the analyst’s grim outlook.

Broader Market Dynamics Fuel Caution

Exchange data reveals mixed signals. While long-term holders continue accumulating, short-term speculation remains elevated. Open interest in BTC futures has surged past $40 billion, indicating leveraged positions vulnerable to cascading stops if volatility spikes.

Institutional inflows through spot ETFs have slowed compared to the frenzy seen in Q3, adding to the bearish sentiment. Meanwhile, macro headwinds—including persistent inflation concerns and potential regulatory scrutiny—keep risk appetite in check.

What Levels Matter Most Right Now?

• $110,000: Immediate support; loss here accelerates selling.
• $100,000: Psychological and pattern neckline; decisive break confirms H&S target.
• $105,000: Location of the 1-week 50 EMA; weekly close below invalidates near-term bullish structure.
• Upside invalidation: Reclaim of $117,000 with volume would negate the bearish setup.

Risk Management Strategies for BTC Holders

Traders navigating this uncertainty should consider tightening stop-losses below $100,000 and scaling out of leveraged long positions. Dollar-cost averaging into weakness remains viable for long-term believers, but only with predefined entry zones and strict position sizing.

Options markets currently price in roughly ±12% implied volatility over the next 30 days, suggesting the market anticipates a big move in either direction. Protective puts centered around the $100,000 strike have seen increased volume, reflecting hedging demand.

Alternative Scenarios: Could Bulls Regain Control?

Despite the ominous technical picture, several catalysts could spark a reversal. A breakout above $117,000 accompanied by expanding volume would invalidate the H&S and target $130,000. Positive developments—such as clearer regulatory frameworks or renewed institutional buying—might provide the necessary fuel.

On-chain metrics show exchange balances at multi-year lows, implying reduced immediate selling pressure from early holders. If spot demand absorbs incoming supply, the path of least resistance could flip bullish sooner than expected.

Final Takeaway

Bitcoin’s current consolidation near $105,000 represents a pivotal juncture. The completed Head and Shoulders pattern, coupled with historical post-peak corrections, supports analyst projections of a potential slide toward $90,000–$80,000. Prudent risk management and close monitoring of the $100,000 neckline are essential until the market resolves its next directional bias.

Investors should remain agile, respecting both the bearish evidence at hand and the ever-present possibility of a bullish surprise in this notoriously volatile asset class.

Georgi Shopov publication: "Bitcoin Price Teeters at $105K: Head and Shoulders Signals Potential Crash to $90K" was written for 24crypto.news

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