Bitcoin Faces $107,000 Support Test As Rally Continues

Legendary trader Peter Brandt has expressed caution regarding the current Bitcoin rally, despite holding a long position on the cryptocurrency. Brandt, known for his extensive experience in the trading world, has identified key support levels that could determine the trajectory of Bitcoin's price movement.

Brandt's latest analysis reveals that Bitcoin has broken out of an expanding triangle pattern, also known as a broadening wedge. This pattern is characterized by a rising lower trendline and an upper line that does not converge, indicating wider price swings and increased risk. While the breakout is encouraging, Brandt warns that expanding triangles often fail, posing a risk of a false breakout if support levels do not hold.

One of the critical support levels Brandt has identified is $107,000. He warns that if Bitcoin dips below this level, the current bullish pattern could morph into a more bearish setup, potentially leading to a sharp pullback. Brandt emphasizes that the real test for the rally is whether Bitcoin can maintain its position above $107,000. If it fails to do so, the market could experience a significant reversal.

Despite the cautionary tone, Brandt remains optimistic about Bitcoin's potential upside if support levels are maintained. He has set price targets around $120,958 and $134,886, based on the pattern's range. Brandt's previous prediction of Bitcoin reaching $118,000 in the near term is still in play, given that the cryptocurrency is currently trading around $112,288, holding above key levels but not yet in the clear.

Brandt's extensive trading experience, spanning over five decades, underscores the importance of vigilance in the market. He acknowledges the potential for a continued rally if Bitcoin can hold above $107,000, but also warns of the risks associated with a potential reversal if this support level is breached. Investors are advised to stay cautious and prepared for potential market fluctuations, as the current state of the market remains highly unpredictable.