Bitcoin price forms rare patterns, raising the possibility of a surge to $166k

Bitcoin price has been under pressure this week, largely due to ongoing trade concerns, but technical indicators suggest that a rebound may be on the horizon, with the possibility of a surge to $166,000.

The crypto fear and greed index dropped to 35, signaling heightened fear within the market, largely driven by the uncertainty surrounding the U.S.-China trade war. The U.S. has already started imposing tariffs on Chinese goods, potentially affecting trade worth over $450 billion. Although tariffs on Canadian and Mexican goods have been paused, there is a possibility that these may resume next month, adding to the market’s unease.

Investors have been cautious, with many remaining on the sidelines. The lack of significant trading activity is evident in weak futures open interest and a decline in Spot Bitcoin ETF inflows, which have dropped from a high of $68 billion to around $57 billion. Additionally, Bitcoin’s price has been influenced by the Federal Reserve’s more hawkish stance, which could impact risk assets like Bitcoin, as the Fed signaled fewer rate cuts than initially anticipated.

Despite these pressures, technical analysis reveals two rare patterns that suggest Bitcoin could see significant gains in the future. The first pattern is the cup and handle, formed between November 2021 and November of last year. This bullish formation, which consists of a rounded bottom followed by consolidation, suggests a potential profit target of $123,000, based on the depth of the cup.

Additionally, Bitcoin is forming a bullish flag pattern. This pattern consists of a steep vertical price increase followed by consolidation in the form of a rectangle. The flag pole’s size, around 55%, indicates that a breakout could lead Bitcoin to as high as $166,000.

However, these patterns are formed on a weekly chart, meaning that a price surge to $166,000 could take time to materialize. The cup and handle pattern, for example, took around three years to develop. As such, while the long-term outlook appears bullish, patience will be required for Bitcoin to reach these elevated levels.