Veteran trader John Bollinger, the creator of Bollinger Bands, has expressed caution about Bitcoin’s immediate future.
Bitcoin has surged nearly 13% over the past week and a half, reaching the $71,000 mark per BTC. This rally has led market analysts and traders to reassess their strategies as Bitcoin inches closer to its all-time high of $74,000.
Amid the bullish sentiment, Bollinger identified a concerning pattern on Bitcoin’s price chart, suggesting a potential pullback or consolidation period. He pointed out the appearance of a two-bar reversal at the upper Bollinger Band, which often indicates a temporary market correction.
I am not fond of the two-bar reversal at the upper Bollinger Band for $btcusd Suggests a consol or a pullback. Not bearish here, just short-term concerned. https://t.co/4567TCglIy
— John Bollinger (@bbands) May 21, 2024
Bollinger Bands are a popular tool among traders, helping to identify volatility and potential price reversals by plotting standard deviations above and below a simple moving average.
Although John Bollinger’s analysis suggests short-term concerns, the trader remains optimistic about Bitcoin’s long-term prospects, a stance based on technical indicators rather than a fundamentally bearish outlook.
Bollinger’s perspective mirrors the current market sentiment, where optimism about Bitcoin’s future growth is balanced by an awareness of potential short-term volatility.
Meanwhile, Willy Woo, crypto analyst and co-founder of VC firm CMCC, has highlighted a different aspect of Bitcoin’s market behavior.
In a May 22 post on X, Woo noted that while Bitcoin’s price had not risen significantly over the past two months, available BTC was quietly being accumulated without an increase in paper BTC.
Woo believes it is only a matter of time before Bitcoin surpasses its all-time highs.
On the same day, the Bitcoin Fear and Greed Index stood at 76. The level of 75-100 shows an extreme level of greed and means that traders in the market are in the mood to buy more.
When the market goes up, people tend to accumulate more cryptocurrency, which means they become more greedy, a phenomenon that leads to higher price movements.
The recent price movement and the analysts’ take come at a crucial time for Bitcoin, which is trading just 6% below its peak price. The market is closely watching to see if Bitcoin can surpass its previous high, a milestone that seems increasingly likely given the current trajectory.
At the time of writing, the world’s largest crypto asset was trading at $69,973, marking a 1.5% drop in the last 24 hours, per data from CoinMarketCap.
